Mr. Bougie joined Montreal-based Alcan Aluminum Ltd. in 1979 and served as the Company's President and Chief Executive Officer from 1993 to 2001. He holds degrees in law and business administration from the Universite de Montreal, where he also received an honorary doctorate in 2001. Mr. Bougie was made an Officer of the Order of Canada in 1994. He currently is a director on the boards of Nova Chemicals Inc., McCain Foods Ltd., Rona Inc., as well as chair or member of a number of advisory committees and foundations, including CGI Group Inc.

"I am delighted to welcome Jacques Bougie to the Board," commented John Weaver, President and CEO. Mr. Bougie is a highly regarded business leader who has met the diverse challenges of a resources-based business. His wealth of knowledge and experience will be of great benefit to Abitibi-Consolidated."

Abitibi-Consolidated is a global leader in newsprint & uncoated groundwood (value-added groundwood) papers as well as a major producer of wood products, generating sales of CAN $5.4 billion in 2003. The Company owns or is a partner in 27 paper mills, 22 sawmills, 4 remanufacturing facilities and 1 engineered wood facility in Canada, the US, the UK, South Korea, China and Thailand. With over 15,000 employees, excluding its PanAsia joint venture, Abitibi-Consolidated does business in approximately 70 countries. Responsible for the forest management of 17.5 million hectares of woodlands, the Company is committed to the sustainability of the natural resources in its care. Abitibi-Consolidated is also the world's largest recycler of newspapers and magazines, serving 16 metropolitan areas in Canada and the United States and 130 local authorities in the United Kingdom, with 14 recycling centres and approaching 20,000 Paper Retriever(R) and paper bank containers.

* * *

As reported in the Troubled Company Reporter on June 15, 2004,Standard & Poor's Ratings Services assigned its 'BB' rating toMontreal, Quebec-based Abitibi-Consolidated Co. of Canada'sUS$200 million floating rate notes due 2011, and US$200 million7.75% notes due 2011. The notes are unconditionally guaranteed byAbitibi-Consolidated Inc. At the same time, Standard & Poor's affirmed its 'BB' long-term corporate credit rating on Abitibi.The outlook is negative.

ABITIBI-CONSOLIDATED: Declares $0.025 Dividend Per Common Share---------------------------------------------------------------Abitibi-Consolidated Inc.'s (NYSE: ABY, TSX: A) Board of Directors approved a dividend payment to shareholders of record on November 1, 2004, amounting to 2.5 cents per common share, payable on December 2, 2004.

Abitibi-Consolidated is a global leader in newsprint & uncoated groundwood (value-added groundwood) papers as well as a major producer of wood products, generating sales of CAN $5.4 billion in 2003. The Company owns or is a partner in 27 paper mills, 22 sawmills, 4 remanufacturing facilities and 1 engineered wood facility in Canada, the US, the UK, South Korea, China and Thailand. With over 15,000 employees, excluding its PanAsia joint venture, Abitibi-Consolidated does business in approximately 70 countries. Responsible for the forest management of 17.5 million hectares of woodlands, the Company is committed to the sustainability of the natural resources in its care. Abitibi-Consolidated is also the world's largest recycler of newspapers and magazines, serving 16 metropolitan areas in Canada and the United States and 130 local authorities in the United Kingdom, with 14 recycling centres and approaching 20,000 Paper Retriever(R) and paper bank containers.

* * *

As reported in the Troubled Company Reporter on June 15, 2004,Standard & Poor's Ratings Services assigned its 'BB' rating toMontreal, Quebec-based Abitibi-Consolidated Co. of Canada'sUS$200 million floating rate notes due 2011, and US$200 million7.75% notes due 2011. The notes are unconditionally guaranteed byAbitibi-Consolidated Inc. At the same time, Standard & Poor's affirmed its 'BB' long-term corporate credit rating on Abitibi.The outlook is negative.

ADESA INC: Declares 4th Quarter $0.075 Per Common Share Dividend ----------------------------------------------------------------ADESA Inc. (NYSE: KAR) reported that the Company's board of directors declared a 2004 fourth quarter dividend of $0.075 per share of outstanding common stock. The dividend is payable December 15, 2004, to shareholders of record on November 15, 2004.

"ADESA's newly established dividend policy reflects the Board's continued confidence in the Company's future and reaffirms our commitment to sharing ADESA's success with our shareholders," stated David G. Gartzke, Chairman and Chief Executive Officer of ADESA, Inc. "We believe that this dividend, in tandem with our pending share repurchase program and our ongoing commitment to grow our operations, demonstrates our focus on sharing ADESA's success with our shareholders both immediately and on a long-term basis."

The Board of ADESA, Inc. currently intends that the Company will follow a quarterly dividend policy of $0.075 per share of common stock. Declaration, record and payment dates for each quarterly dividend will be set at a later time.

Headquartered in Carmel, Indiana, ADESA, Inc. (NYSE: KAR) is North America's largest publicly traded provider of wholesale vehicle auctions and used vehicle dealer floorplan financing. The Company's operations span North America with 53 ADESA used vehicle auction sites, 28 Impact salvage vehicle auction sites and 81 AFC loan production offices. For further information on ADESA, Inc., visit the Company's Web site at http://www.adesainc.com/

* * *

As reported in the Troubled Company Reporter on June 4, 2004, Standard & Poor's Rating Services assigned its 'B+' rating to ADESA Inc.'s proposed $125 million senior subordinated notes due 2012, and affirmed its 'BB' corporate credit and senior secured ratings on the Carmel, Indiana-based operator of wholesale used- vehicle auctions and provider of used-vehicle floorplan financing.The outlook is stable.

AMERICAN AIRLINES: Parent Posts $214 Million 3rd Quarter Net Loss-----------------------------------------------------------------AMR Corporation, the parent company of American Airlines, Inc., reported a net loss of $214 million in the third quarter. This compares to last year's third quarter net profit of $1 million.

"Our business was buffeted by three dramatic and harmful developments during the third quarter," said AMR Chairman and CEO Gerard Arpey. "The first was record high fuel prices. The second was a weak revenue environment, which meant that despite our best efforts -- and unlike other fuel-intensive businesses -- we have been largely unable to pass the higher fuel costs on to our customers. The third development was the unprecedented series of hurricanes, which depressed revenue, increased costs and repeatedly disrupted an important part of our network."

Skyrocketing fuel prices during the quarter resulted in a year-over-year increase of more than 40 cents per gallon, which translated into $342 million in incremental fuel costs compared to a year ago. Meanwhile, American's revenue per available seat mile declined 2.5 percent, driven by a 4.8 percent drop in passenger yield (passenger revenue per passenger mile).

"Weak yields are an industry-wide phenomenon," Mr. Arpey said.

"Although many industries are getting hammered by high fuel prices, the airline industry has largely been unable to price its product in a way that reflects the higher cost of production. Low cost carrier growth is partly responsible for the depressed fare environment, but there are other factors at work too.

"Specifically, there is a growing disconnect between industry capacity growth in the domestic marketplace and overall economic growth," Mr. Arpey said. "While the economy has grown roughly three and a half percent this year, available domestic seat miles are up more than six percent. Making matters worse has been the competitive behavior of some carriers either in or on the verge of bankruptcy."

According to Mr. Arpey, the confluence of high fuel prices and low fares has sharpened the company's focus on making the changes necessary to improve the company's financial condition. "The harsh reality is that despite our tremendous progress to date, our cost structure remains too high for us to succeed in a world where the price of oil is at such an extraordinary level," Mr. Arpey said. "However, there is still a lot we can do, and are doing, to increase revenues and reduce expenses."

That said, AMR anticipates the record high fuel prices to continue in the fourth quarter -- a quarter that is typically seasonally weak from a revenue perspective. Thus, AMR expects to incur a fourth quarter loss significantly larger than that recorded in the third quarter.

Mr. Arpey cited a series of steps American has taken to increase revenues, cut costs and put the airline on a stronger financial footing. One expected outcome of these initiatives is that there will be a reduction in the size of the workforce, although the details for accomplishing this are still being identified. American's new initiatives include:

-- Aircraft Decisions -- American has decided to withdraw capacity equivalent to 15 narrow-body aircraft in 2005 while its regional affiliate, American Eagle, has reached an agreement in principle with Embraer to not take delivery of the last 18 ERJ-145 regional jet aircraft, scheduled for delivery between July 2005 and February 2006.

-- Seat Decisions -- American will add back a portion of the coach seats previously removed from its MD80, 737, 767 and 777 fleets. On the MD80 and 737 aircraft, only one of the two rows of coach seats originally removed will be added back to those airplanes. In addition, the MD80 reconfiguration will expand the first class cabin by two seats, in recognition of the value American's customers place on its first class product.

-- International Expansion -- American intends to increase revenue by continuing its expansion in the growing Asia/Pacific market. Yesterday, the airline announced that it will launch daily nonstop service between Chicago and Nagoya, Japan, on April 3, and resume daily nonstop service between Dallas/Fort Worth and Osaka, Japan, on Nov. 1, 2005. American is also vigorously seeking authority to begin nonstop service between Chicago and Shanghai, China, starting on May 1, 2005.

-- Simplified Operations -- American has decided to expand upon an experiment it launched in the summer of 2004 in Chicago, in which aircraft types were isolated to certain stations, and flight crew and aircraft were scheduled together. This change of approach will be implemented throughout American's system in 2005, Mr. Arpey said. "We are pressing ahead aggressively to streamline and simplify American's operations."

-- Other Revenue Initiatives -- American's revenue initiatives have involved a variety of fare actions in certain markets as well as the introduction of ticketing fees. American now charges $5 for tickets purchased through U.S. reservations offices while a $10 fee applies to tickets bought at U.S. airport locations. There also is now a fee for paper tickets purchased through travel agents in certain European countries, the Caribbean, Mexico and Latin America for itineraries that are eligible for electronic tickets. Additionally, the U.S. Department of Transportation recently issued a favorable ruling, allowing U.S. carriers to apply fuel surcharges to all of their international routes, which should further improve revenue.

-- Dallas Reservations Office Consolidation -- To cut costs and increase efficiency, American said it has decided to consolidate its reservations office in south Dallas with its much larger Southern Reservations Office near DFW Airport, saving the company hundreds of thousands of dollars a year in various expenses.

With regard to adding back seats, Mr. Arpey said American is acting to increase revenue by eliminating a seating capacity disadvantage largely attributable to the More Room Throughout Coach program the airline launched several years ago. "When we launched More Room Throughout Coach, healthy yields and robust business travel were the norm, and both conditions were essential to the success of More Room," Mr. Arpey said. "However, times have changed, and we must acknowledge that in today's low-fare environment, having fewer seats on our aircraft has put us at a real revenue disadvantage compared to other airlines."

Mr. Arpey said that as a result of its aircraft and seating changes, American's first quarter domestic capacity will decrease approximately 5 percent. "Given our skyrocketing fuel costs, and our limited ability to pass those costs on to our customers, we feel it is prudent to draw down a portion of our domestic schedule. And rather than decrease flight schedules across the board, we will be focusing our cuts on specific markets where our service is either redundant to service to nearby cities or is less essential to our domestic network. At the same time, we are going to intensify our focus on our areas of strength. For instance, we now plan to increase our flying at Dallas/Fort Worth by 90 operations year over year, a larger increase than we had previously announced," Mr. Arpey said.

As a result of the initiatives discussed, the company reported that some special charges may be recognized in the fourth quarter -- the amount and scope of which are currently being identified. In addition, the company expects to record a gain of approximately $145 million from the sale of its interest in Orbitz (an on-line travel agency in which American holds an ownership stake), if the closing of that sale occurs in the fourth quarter.

"Very challenging industry conditions are nothing new to the people of American Airlines," Mr. Arpey said. "We remain committed to continuing to evolve our company by wringing out costs and inefficiency from everything we do. What's more, we are determined to make the hard choices necessary to ensure our company's competitiveness and ultimate success."

American Airlines is the world's largest carrier. American, American Eagle and the AmericanConnection regional carriers serve more than 250 cities in over 40 countries with more than 4,200 daily flights. The combined network fleet numbers more than 1,000 aircraft. American's award-winning Web site, http://AA.com/provides users with easy access to check and book fares, plus personalized news, information and travel offers. American Airlines is a founding member of the oneworld(sm) Alliance.

AMERICAN AIRLINES: Pilots Express Disappointment Over Q3 Results----------------------------------------------------------------The Allied Pilots Association, collective bargaining agent for the 13,500 pilots of American Airlines (NYSE:AMR), issued this statement during a meeting of its 18-member board of directors. All 18 directors and the APA President, Vice President and Secretary-Treasurer endorsed the statement:

"In 2003, amidst the backdrop of an eroding cash position and legitimate belief that American Airlines was but a step away from bankruptcy, the pilots of American Airlines decided to invest more than $3.3 billion in the airline to secure our future and maintain control of our fate. With this action, our pilots demonstrated that they are not only commanders of the aircraft during flight, but also leaders of the airline on the ground. The other unions at American Airlines also chose to invest in the airline to help prevent bankruptcy last year.

"It now appears that the positive results we anticipated from this investment have been at least temporarily deferred by external forces -- foremost among them the dramatic rise in oil prices.

"Make no mistake, we are deeply disappointed with the third- quarter results. That said, we believe our proactive approach last year was prudent, appropriate and beyond Wall Street's expectations. Nothing in the current situation convinces us otherwise. The alternative, as illustrated by US Airways, United Airlines and Delta Air Lines, is not appealing.

"While the APA Board of Directors has made no firm decisions on what further action may become necessary, we are committed to securing our pilots' careers. We are confident that all of our other fellow employees likewise recognize the need to safeguard the long-term viability of American Airlines."

Founded in 1963, the Allied Pilots Association is headquartered in Fort Worth, Texas.

American Airlines is the world's largest carrier. American, American Eagle and the AmericanConnection regional carriers serve more than 250 cities in over 40 countries with more than 4,200 daily flights. The combined network fleet numbers more than 1,000 aircraft. American's award-winning Web site, http://AA.com/provides users with easy access to check and book fares, plus personalized news, information and travel offers. American Airlines is a founding member of the oneworld(sm) Alliance.

Type of Business: The Debtor is an affiliate of Aleph Management Systems, Inc., which filed for chapter 11 protection on October 15, 2004 (Bankr. E.D. Pa. Case No. 04-33939). Aleph Management Systems, Inc., provides ground transportation services on a contractual basis. The areas of business are paratransit, charter, bus, and school bus transportation. The Company also provides financial and risk management services to various companies.

AMES DEPARTMENT: Connecticut Balks at Conveyance Tax Exemption--------------------------------------------------------------Ames Department Stores and its subsidiaries ask the U.S. Bankruptcy Court for the Southern District of New York to exempt them from paying conveyance taxes in relation to the proposed sale of their real property in Rocky Hill, Connecticut for $3.7 million.

Connecticut's Revenue Services Department said that the relief sought by the Debtors is not possible because they don't have a confirmed chapter 11 plan pursuant to Section 1129 of the Bankruptcy Code.

The Debtors quote Section 1146 of the Bankruptcy Code stating that they can be exempted from paying the tax if it "will facilitate the formulation and confirmation of a chapter 11 plan."

The Revenue Services urges the Court to deny the exemption sought by the Debtors because it believes that the Debtors are not even likely to confirm a plan of reorganization.

The Honorable Robert D. Drain issued a decision this week in In re Beulah Church Of God In Christ Jesus, Inc., Bankruptcy Case No. 03-42705 (RDD) (Bankr. S.D.N.Y. Oct. 18, 2004), telling the New York City Finance Department that the pre-confirmation sale of 23 of its 24 properties located in New York, Kings, Queens and Bronx Counties would be exempt from the New York City real property transfer tax and the New York City mortgage recording tax. In Beulah Church's case, the City objected to the exemption arguing that the Debtor's buildings were not sold "under a plan confirmed" within the meaning of section 1146(c) of the Bankruptcy Code. The Debtor, in turn, argued that section 1146(c) does not condition exemption from the Transfer Taxes on confirmation of a chapter 11 plan before the closing of a sale, but, rather, that the sale may be exempt provided that the sale is integral to plan confirmation, or confirmation occurs because of the sale. In the Debtor's interpretation, therefore, the phrase "under a plan confirmed", as used in section 1146(c) of the Bankruptcy Code, means that the sale is in view of, or in accordance with, and subject to, the anticipated confirmation of a chapter 11 plan. Judge Drain rejects the City's bright line interpretation of section 1146(c). If the precise time of the sale were controlling, Judge Drain suggests, clever, lucky and tricky lawyers would craft sales agreements and plans that would make every transaction happen post-confirmation. "I assume," Judge Drain says, "that Congress intended the Debtor's approach, because it is reasonable to conclude that Congress did not intend to impose an arbitrary and illogical temporal distinction on sales necessary or integral to a chapter 11 plan."

ARCH WESTERN: Moody's Puts Ba3 Rating on $250M Guaranteed Sr. Note------------------------------------------------------------------Moody's Investors Service assigned a Ba3 rating to Arch Western Finance's proposed $250 million 6.75% guaranteed senior note issue due 2013. All other ratings of Arch Western Finance and its parent, Arch Coal Inc., were affirmed. Arch Western Finance's notes are guaranteed by its parent, Arch Western Resources, a subsidiary of Arch Coal.

Concurrent with the note issue, Arch Coal is offering 6.25 million common share units, which, if successful, would raise proceeds of approximately $200 million.

The Ba3 rating reflects Moody's belief that Arch Coal's free cash flow will be negative over at least the next four years due to extraordinarily high capital expenditures, which, when combined with the potential for higher operating costs, especially in the east, and the potential for a reversal of today's record coal prices, could result in a material increase in leverage and constrain the company's ability to service its debt. A large proportion of the planned capex is non-discretionary since it is targeted for annual payments for federal coal leases in the Powder River Basin -- PRB. This coal will not be mined for many years and, therefore, will not generate near-term cash flow. Moody's also notes that increased costs and rail disruptions, combined with a high proportion of locked in contracts, have thus far prevented Arch Coal from materially benefiting from current high spot coal prices. The rating outlook for both companies is stable.

The combined proceeds of the debt and equity offerings will be used to repay debt at Arch Western and Arch Coal, and for general corporate purposes. The net impact of the two offerings will be to reduce Arch Coal's debt to capital ratio (including preferred stock as debt) from approximately 61.9% at September 30, 2004 to approximately 55.9% (pro forma for the two issues and anticipated debt reduction).

Arch Coal will incur significantly higher than historic capex over the next five years as it funds the recent $611 million acquisition of the Little Thunder PRB reserves ($122 million per annum), develops the Mountain Laurel mine in Central Appalachia ($190 million over three years), and funds maintenance capex. The Little Thunder acquisition will not be mined for many years, providing no near term incremental cash flow. A similar situation may well exist if additional reserves are acquired, by lease or otherwise. The Mountain Laurel mine is an important development for the company that will provide high quality, low cost coal, but will not be in full operation until 2007. This higher level of capex with no immediate return on investment comes at a time when the company continues to be pressured by rising costs, particularly at its eastern operations. Arch Coal, like most eastern producers, has been impacted by higher pension, healthcare, steel, explosive and energy costs, and by rail disruptions. The result has been an inability to materially benefit from the higher coal prices now being experienced. The high level of capex combined with continuing cost pressures place Arch Coal at risk to a decline in spot coal prices, which Moody's views as quite possible over the next two years. Moody's expects that the Arch Western Resources operations should continue to produce steady, low margin cash flow, which is lent up to the parent. However, we do not expect Arch Western Resources's free cash flow to be sufficient to offset the negative free cash flow in the eastern operations, resulting in a possibility of higher debt levels.

Arch Coal's Ba3 senior implied rating reflects:

(i) its high leverage,

(ii) mine development and reserve acquisition costs,

(iii) increased operating costs, particularly in the east,

(iv) significant dependence on one mine, and

(v) substantial liabilities for reclamation and employee benefits, which totaled approximately $615 million as of June 30, 2004.

In the eastern operations in particular, heightened regulatory risk and permitting uncertainties are expected to continue. In short, the profitability and scope of Arch Coal's eastern operations may decline unless coal prices remain sufficiently high to offset recent negative trends in:

* costs, * reserve degradation, and * mine development costs.

In Moody's opinion, long-term coal prices may continue to remain at high levels, but in concert with rising costs, thereby keeping profit margins relatively constant. This has been the historical pattern for the coal industry and was the pattern over the last three years, when most of the benefits of higher prices were offset by higher costs.

(i) the overall good quality of the company's mines and coal reserves, which operate in three distinct western coal fields,

(ii) its favorable market position as a supplier of low sulfur and compliance coal to numerous utility customers,

(iii) its competitive costs, and

(iv) its contracted fixed price contracts.

Arch Western Resources is relatively unburdened by workers' comp and retiree healthcare costs. However, Arch Western Resources pro forma debt to EBITDA is approximately 4.7x (using Arch Western Resources, North Rochelle and Canyon Fuel full year 2003 plus the $250 million senior note issue. Arch Western Resources now consolidates 100% of Canyon Fuel, following the acquisition by Arch Coal of the 35% of Canyon Fuel Arch Western Resources did not own. Arch Coal's 35% minority interest is reflected in Arch Western Resources' net income. Canyon Fuel conducts all of the company's coal mining activities in the state of Utah. Arch Coal anticipates that the addition of 35% of Canyon Fuel will add incremental annual EBITDA of $15 million. The recently acquired North Rochelle mine produced $41.6 million of EBITDA in 2003, and Arch Western Resources anticipates annual synergies of $15 to $20 million from the combination of North Rochelle and Black Thunder.

The stable outlook reflects:

(i) the Arch Coal's extensive operations and reserves, (ii) its long-term sales contracts, and (iii) coal's importance as a fuel for electricity generation.

These factors help insulate Arch Coal from the impact of changes to mining, environmental and electric utility regulations and provide flexibility for adapting to changes in regional coal demand. The ratings could be raised if Arch Coal is able to demonstrate that it can generate consistent free cash flow sufficient to meaningfully reduce debt. The rating could be lowered if:

(i) the company's leverage and debt protection measurements weaken, which could result from a return to the margins experienced in the past few years, coupled with the elevated capex levels now anticipated, or if

(ii) it undertakes debt financed acquisitions.

In the 2001 to 2003 period the company's EBIT (excluding "other" income and expense) averaged 6 cents per ton of coal sold, equivalent to an operating profit margin of .5%.

Arch Western Resources' high leverage and certain structural features of its senior notes reflect provisions imposed by its acquisition from ARCO in June 1998. In order to avoid triggering a tax liability, Arch Western Resources' debt cannot be guaranteed by Arch Coal and cannot amortize below $675 million until June 1, 2013. However, cash moves freely between Arch Coal and Arch Western Resources and a sizable receivable, documented as promissory notes, is growing on the balance sheet of Arch Western Resources, reflecting cash that it has transferred to Arch Coal since 1998. The lenders to Arch Western Resources have a first priority secured interest in the Arch Coal promissory notes. These notes are unsecured obligations of Arch Coal and are structurally subordinated to debt and other liabilities (such as reclamation and workers' comp) of Arch Coal's subsidiaries. Arch Coal also provides administrative, selling, engineering, and financial services to Arch Western Resources, and pays income taxes that Arch Western Resources might otherwise have to pay. Also, Arch Coal is the direct lessee for about 55% of Arch Western Resources' coal reserves. For all of these reasons, and because of the importance of Arch Western Resources to Arch Coal, Moody's believes that Arch Western Resources and Arch Coal should be rated the same.

Arch Western Resources is a large producer of compliance and low sulfur coal with operations in Wyoming, Utah and Colorado. It sold 70 million tons of coal in 2003 and had revenues of $500 million. Arch Coal, Inc. is one of the largest coal companies in the US. In addition to its western operations, which are conducted by Arch Western Resources, Arch Coal operates in West Virginia and Kentucky. Arch Coal sold 109 million tons of coal in 2003 and had revenues of $1.4 billion. Both companies are headquartered in St. Louis.

AXIA NETMEDIA: Will Release 2005 1st Quarter Results on Oct. 27---------------------------------------------------------------Axia NetMedia Corporation will release its fiscal First Quarter 2005 results the morning of October 27, 2004. In addition, the Corporation's 2004 Annual Meeting will be held on October 27, 2004 at 11:00 a.m., at Axia's corporate offices at 3300 - 450 1st St. S.W. It will be webcast via Canada NewsWire. Additionally, a conference call for the investment community on the fiscal First Quarter 2005 results will be held at 9:00 a.m. (Eastern Time) and 7:00 a.m. (Mountain) on October 28, 2004.

Axia will release its Fiscal First Quarter 2005 results the morning of Wednesday, October 27, 2004. A conference call for the investment community will be held on Thursday, October 28, 2004 at 9:00 a.m. (Eastern) and 7:00 a.m. (Mountain). Axia Chairman and Chief Executive Officer Art Price will be available with President Murray Wallace and Chief Financial Officer Peter McKeown.

To participate in the conference call, please dial (416) 640-4127 in Toronto and internationally. If you are connecting from other parts of Canada, dial 1-800-814-4853. Call 10 minutes prior to the start of the call.

A live webcast (listen only mode) of the conference call will be available at:

A replay of the conference call will be available at (416) 640-1917 or 1-877-289-8525, passcode 21096025 followed by the number sign, from 11 a.m. (ET) October 28 to midnight Thursday, November 4, 2004, or through the webcast archives at http://www.newswire.ca.

About Axia

Axia NetMedia Corporation helps organizations and individuals meet the needs of the Knowledge Economy by combining the power of next-generation, Real Broadband networks with high-end e-learning applications. Axia has 176 employees and trades on the Toronto Stock Exchange under the symbol AXX.

Axia NetMedia Corporation helps organizations and individuals meet the needs of the Knowledge Economy by combining the power of high- speed Real Broadband networks with high-end e-learning applications. Axia has 176 employees and trades on the Toronto Stock Exchange under the symbol "AXX". For more information, visit its website at http://www.axia.com/

* * *

As reported in the Troubled Company Reporter on May 28, 2004, Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to industrial products manufacturer AXIA Inc. The outlook is stable.

At the same time, Standard & Poor's assigned its 'B' bank loan rating and its recovery rating of '4' to AXIA's proposed $150 million senior secured credit facility, based on preliminary terms and conditions.

BETHLEHEM STEEL: 3 Firms Now Represent Trust in Preference Actions------------------------------------------------------------------As previously reported, the Bethlehem Steel CorporationLiquidating Trust was deemed substituted as plaintiff in all of the complaints filed by Bethlehem Steel Corporation and its debtor-affiliates to avoid preferential transfers.

The Liquidating Trust and the Preference Counsel have agreed to have those Preference Actions as to which Weil Gotshal & Manges,LLP, and Kramer Levin Naftalis & Frankel, LLP, currently represent the Liquidating Trust, transferred to Gazes & Associates, LLP.

None of the Preference Actions is past the discovery stage.

It would be extremely cumbersome for the Liquidating Trustee to prepare and file, and for the Court to process, consents to change attorney in each of the affected Preference Actions.

The Court promptly approves the parties' stipulation. JudgeLifland waives the requirement under Rule 9013-1(b) of the Local Bankruptcy Rules for the Southern District of New York for the filing of a separate memorandum of law.

Headquartered in Bethlehem, Pennsylvania, Bethlehem Steel Corporation -- http://www.bethlehemsteel.com/-- was the second- largest integrated steelmaker in the United States, manufacturing and selling a wide variety of steel mill products including hot-rolled, cold-rolled and coated sheets, tin mill products, carbon and alloy plates, rail, specialty blooms, carbon and alloy bars and large diameter pipe. The Company filed for chapter 11 protection on October 15, 2001 (Bankr. S.D.N.Y. Case No. 01-15288). Jeffrey L. Tanenbaum, Esq., and George A. Davis, Esq., at WEIL, GOTSHAL & MANGES LLP, represent the Debtors in their restructuring, the centerpiece of which was a sale of substantially all of the steelmaker's assets to International Steel Group. When the Debtors filed for protection from their creditors, they listed $4,266,200,000 in total assets and $4,420,000,000 in liabilities. Bethlehem obtained confirmation of a chapter 11 plan on October 22, 2003, which took effect on Dec. 31, 2003. (Bethlehem Bankruptcy News, Issue No. 54; Bankruptcy Creditors' Service, Inc., 215/945-7000)

BOISE CASCADE: Extends Debt Securities' Price Determination Date ----------------------------------------------------------------Boise Cascade Corporation (NYSE: BCC) extended the price determination date in connection with its tender offer for its debt securities for up to $800 million of aggregate consideration. The Total Consideration and the Tender Offer Consideration will be determined as of 2:00 p.m., New York City time, today, October 22, 2004 unless otherwise modified.

Boise retained Banc of America Securities LLC as the sole dealer manager and solicitation agent for the offer. Holders can direct questions about the offer to:

Holders can request documentation from D.F. King & Co., Inc., the information agent for the offer, at 800-901-0068 (U.S. toll-free) and 212-269-5550 (collect).

About the Company

Boise Cascade Corporation, headquartered in Boise, Idaho, provides solutions to help customers work more efficiently, build more effectively, and create new ways to meet business challenges. We own or control more than 2 million acres of timberland, primarily in the United States, to support our manufacturing operations. Boise's sales were $10.6 billion in the first nine months 2004.

Boise Office Solutions, headquartered in Itasca, Illinois, is a division of Boise and a premier multinational contract and, under the OfficeMax(R) brand, retail distributor of office supplies and paper, technology products, and office furniture. Boise Office Solutions had sales of $6.6 billion in the first nine months 2004.

Boise Building Solutions, headquartered in Boise, Idaho, is a division of Boise and manufactures plywood, lumber, particleboard, and engineered wood products. The business also operates 27 facilities that distribute a broad line of building materials, including wood products manufactured by Boise. Boise Building Solutions posted sales of $3.0 billion in the first nine months 2004.

Boise Paper Solutions, headquartered in Boise, Idaho, is a division of Boise and a manufacturer of office papers, a majority of which are sold through Boise Office Solutions. Boise Paper Solutions also manufactures printing, forms, and converting papers; value-added papers; newsprint; containerboard and corrugated containers; and market pulp. The division had sales of $1.5 billion in the first nine months 2004. Visit the Boise website at http://www.bc.com/

* * *

As reported in the Troubled Company Reporter on Oct. 11, 2004, Moody's Investors Service assigned the ratings to Boise Cascade, LLC.

BREUNERS HOME: Committee Balks At Modified Employee Retention Plan------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware approved Breuners Home Furnishing Corp.'s key employee retention plan in July that proposed to pay select individuals who remained in the company's employ trough Oct. 31, 2004. Breuners says it won't be possible to wind up the company's affairs by October 31, and still needs these key employees. To solve the problem, Breuners proposes to pay additional retention bonuses to these people. The Debtor indicates that the business should be wound down by year-end.

Breuners originally asked the Bankruptcy Court for authority to pay up to $1,145,800 to 117 key employees. After the Committee complained, Breuners agreed to contract the amount to $975,000 plus an additional $25,000 amount that would require Committee approval. Breuners now wants to add $101,000 to the pot. The Committee objects.

"The Committe is not convinced, at this point, that additional funds are required by the Debtors in view of the reduction in personnel causing a reduction in the need for funds to retain Key Personnel," Platzer, Swergold, Karlin, Levine, Goldberg & Jaslow, LLP, counsel to the Committee, tells the Court. "Further, the Committee does not believe that given the current economic environment, personnel presently employed will not foresake employment solely by reason of the Debtors' inability to provide them with an enhanced bonus beyond the bonus which they would have been entitled to under the original key employee retention program. The employees are receiving their current salary and will neither stay or leave by virtue of the additional bonuses."

A further increase in the KERP does nothing, the Committee indicates, to encourage the wind down of the Debtors' business operation.

Headquartered in Lancaster, Pennsylvania, Breuners Home Furnishings Corp., -- http://www.bhfc.com/-- was one of the largest national furniture retailers focused on the middle to upper-end segment of the market. The Company, along with its debtor-affiliates, filed for chapter 11 protection on July 14, 2004 (Bankr. Del. Case No. 04-12030). Great American Group, Gordon Brothers, Hilco Merchant Resources, and Zimmer-Hester were brought on board within the first 30 days of the bankruptcy filing to conduct Going-Out-of-Business sales at the furniture retailer's 47 stores. Bruce Grohsgal, Esq., and Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl, Young & Jones represent the Debtors in their restructuring efforts. The Company reported more than $100 million in estimated assets and debts when it sought protection from its creditors.

The proceeds of the offering of the Redeemable Preferred Shares will be initially loaned to Calpine's 1,200-megawatt Saltend cogeneration power plant located in Hull, Yorkshire, England, and the payments of principal and interest on such loan will fund payments on the Redeemable Preferred Shares. The net proceeds of the Redeemable Preferred Shares offering will ultimately be used as permitted by the company's indentures.

Calpine Corporation is a North American power company dedicated to providing electric power to customers from clean, efficient, natural gas-fired and geothermal power plants. The company generates power at plants it owns or leases in 21 states in the United States, three provinces in Canada and in the United Kingdom.

* * *

As reported in the Troubled Company Reporter on Oct. 13, 2004, Standard & Poor's Ratings Services assigned its 'CCC+' rating to Calpine Corp.'s (B/Negative/--) $736 million unsecured convertible notes due 2014. The rating on the notes is the same as Calpine's existing unsecured debt and two notches lower than the corporate credit rating. The outlook is negative.

As reported in the Troubled Company Reporter on Oct. 6, 2004,Fitch Rates Calpine Corp.'s:

CATHOLIC CHURCH: Tucson Not Required to Pay Utility Deposits------------------------------------------------------------Under Section 366 of the Bankruptcy Code, public utility providers may require adequate assurance of future payments in the form of a deposit or other security so as not to alter, refuse, or discontinue service. Specifically, Section 366(b) provides that:

"Such utility may alter, refuse, or discontinue service if neither the trustee nor the debtor, within 20 days after the [Petition Date], furnishes adequate assurance of payment in the form of a deposit or other security, for service after such date. On request of a party-in-interest and after notice and hearing, the court may order reasonable modification of the amount of the deposit or other security necessary to provide adequate assurance of payment."

To maintain and keep public utility services available and to avoid the unnecessary expense associated with negotiating with public utility providers, posting additional deposits, or incurring the expense associated with actions brought pursuant to Section 366, the Roman Catholic Church of the Diocese of Tucson asks Judge Marlar to declare that it has complied with Section 366 and that its utility service providers are adequately assured of payment for future services.

The Diocese asserts that (i) the allowance of any postpetition claims of utility providers, (ii) the fact that there are no prepetition amounts owing to any utility providers, and (iii) the past payment history of the Diocese are sufficient to satisfy the requirements of Section 366.

Susan G. Boswell, Esq., at Quarles & Brady Streich Lang, LLP, in Tucson, Arizona, relates that she contacted Tucson Electric Power, Southwest Gas, and the City of Tucson Water. They have all consented to the request. There are no outstanding balances owed to utilities.

"Motion granted," Judge Marlar rules from the bench.

The Roman Catholic Church of the Diocese of Tucson filed for chapter 11 protection (Bankr. D. Ariz. Case No. 04-04721) on September 20, 2004, and delivered a plan of reorganization to the Court on the same day. Susan G. Boswell, Esq., Kasey C. Nye, Esq., at Quarles & Brady Streich Lang LLP, represent the Tucson Diocese. The Archdiocese of Portland in Oregon filed forchapter 11 protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004. Thomas W. Stilley, Esq. and William N. Stiles, Esq. of Sussman Shank LLP represent the Portland Archdiocese in its restructuring efforts. Portland's Schedules of Assets and Liabilities filed with the Court on July 30, 2004, the Portland Archdiocese reports $19,251,558 in assets and $373,015,566 in liabilities. (Catholic Church Bankruptcy News, Issue No. 7; Bankruptcy Creditors' Service, Inc., 215/945-7000)

CHOICE ONE: Hires Chadbourne & Parke as Special Regulatory Counsel------------------------------------------------------------------The U.S. Bankruptcy Court for the Southern District of New York gave Choice One Communications Inc., and its debtor-affiliates, permission to employ Chadbourne & Parke LLP, as their special regulatory counsel on an interim basis.

The Court scheduled a hearing to consider the Debtors' application to employ Chadbourne & Parke on a permanent basis at 10:00 a.m., on October 25, 2004.

Chadbourne & Parke will:

a) render specialized expertise to the Debtors in connection with legal representation;

b) advise the Debtors concerning regulatory and transactional matters in the telecommunication industry; and

c) render other services and tasks to the Debtors generally incidental to its role as special regulatory counsel.

Dana Frix, Esq., a Partner at Chadbourne & Parke, discloses that the Firm received a $50,000 retainer. Ms. Frix will bill the Debtors $560 per hour for her services.

To the best of the Debtors' knowledge, Chadbourne & Parke is "disinterested" as the term is defined in Section 101(14) of the Bankruptcy Code.

Headquartered in Rochester, New York, Choice One Communications, Inc. -- http://www.choiceonecom.com/-- is an Integrated Communications Provider offering voice and data services including Internet solutions, to businesses in 29 metropolitan areas (markets) across 12 Northeast and Midwest states. Choice One reported $323 million of revenue in 2003, and provides services to more than 100,000 clients. The Company and its 18 debtor- affiliates filed for chapter 11 protection on October 5, 2004 (Bankr. S.D.N.Y. Case No. 04-16433). Jeffrey L. Tanenbaum, Esq., and Paul M. Basta, Esq., at Weil Gotshal & Manges LLP, represent the Debtors in their restructuring efforts. When the Debtors filed for bankruptcy, they reported $354,811,000 in total assets and $1,078,478,000 in total debts on a consolidated basis.

CHOICE ONE: Can Continue Hiring Ordinary Course Professionals------------------------------------------------------------- The Honorable Robert D. Drain of the U.S. Bankruptcy Court for the Southern District of New York gave Choice One Communications Inc., and its debtor-affiliates, permission on an interim basis, to continue to retain, employ and pay professionals they turn to in the ordinary course of their business without bringing formal employment applications to the Court.

The Court scheduled a hearing to consider the Debtors' application to employ the Ordinary Course Professionals on a permanent basis at 10:00 a.m., on October 25, 2004.

The Debtors relate that the Ordinary Course Professionals they employ render a wide range of services, including accounting, legal and tax services, that impact their day-to-day operations.

The Debtors explain that because of the additional cost associated with the preparation of employment applications for each Ordinary Course Professional who will receive relatively small fees, it would be impractical and inefficient to require the Debtors to submit individual applications and proposed retention orders for each of the professionals.

The Debtors add that it is essential that the employment of the Ordinary Course Professionals be continued on an ongoing basis to avoid disruption of their normal business operations.

The Debtors assure the Court that:

a) each Ordinary Course Professional shall be paid 100% of the fees and expenses they will bill the Debtors provided that each professional will submit to the Debtors an invoice detailing the services rendered and disbursements incurred,

b) no Ordinary Course Professional will be paid in excess of $50,000 per month or an aggregate amount of $350,000 per month for all the professionals retained by the Debtors, and

c) if an Ordinary Course Professional bills the Debtors more than $50,000 in a single month, the professional will be required to file a fee application in order to be paid the full amount of their fees and disbursements in accordance with sections 330 and 331 of the Bankruptcy Code.

Although some of the Ordinary Course Professional may hold minor amounts of unsecured claims, the Debtors do not believe any of them have an interest adverse to the Debtors, their creditors or other parties in interest.

Headquartered in Rochester, New York, Choice One Communications, Inc. -- http://www.choiceonecom.com/-- is an Integrated Communications Provider offering voice and data services including Internet solutions, to businesses in 29 metropolitan areas (markets) across 12 Northeast and Midwest states. Choice One reported $323 million of revenue in 2003, and provides services to more than 100,000 clients. The Company and its 18 debtor- affiliates filed for chapter 11 protection on October 5, 2004 (Bankr. S.D.N.Y. Case No. 04-16433). Jeffrey L. Tanenbaum, Esq., and Paul M. Basta, Esq., at Weil Gotshal & Manges LLP, represent the Debtors in their restructuring efforts. When the Debtors filed for bankruptcy, they reported $354,811,000 in total assets and $1,078,478,000 in total debts on a consolidated basis.

COMM 2001-FL4: Moody's Pares Ratings on Five Classes to Low-B-------------------------------------------------------------Moody's Investors Service downgraded five classes and affirmed four classes of COMM 2001-FL4, Commercial Mortgage Pass-Through Certificates as follows:

-- Class B, $11,302,081, Floating, affirmed at Aaa

-- Class X-2, Notional, affirmed at Aaa

-- Class K-PS, $2,381,000, Floating, downgraded to B3 from Ba1

-- Class L-PS, $1,163,000, Floating, downgraded to B3 from Ba2

-- Class M-PS, $7,037,000, Floating, downgraded to B3 from Ba3

-- Class K-CH, $806,652, Floating, downgraded to Ba1 from Baa1

-- Class M-CH, $2,276,267, Floating, downgraded to Ba3 from Baa3

-- Class L-KC, $1,718,000, Floating, affirmed at Baa2

-- Class M-KC, $1,300,000, Floating, affirmed at Baa3

The Certificates are collateralized by three mortgage loans, which range in size from 19.0% to 60.9% of the pool based on current principal balances. As of the October 15, 2004 distribution date, the transaction's aggregate certificate balance has decreased by approximately 84.4% to $134.6 million from $862.7 million at closing. The mortgage loans do not provide for principal amortization. The pool balance reduction is due to eight loan payoffs and the partial payoff of the Cherry Hill Office Portfolio Loan.

Class B is affirmed. Moody's does not rate pooled Classes C, D and E. Classes K-PS, L-PS and M-PS pertain to the 100 Pine Street Loan and have been downgraded due to poor performance. Classes K-CH and M-CH pertain to the Cherry Hill and have also been downgraded due to poor performance. Classes L-KC and M-KC relate to the Key Center Loan and are affirmed.

The 100 Pine Street Loan, which represents 60.9% of the pool balance, is secured by a 394,000 square foot Class A- office building located in San Francisco's financial district. The property is currently 65.2% occupied, compared to 97.7% at securitization although occupancy is anticipated to increase to 81.0% due to recent lease executions. Rent achievement for the majority of the new and renewal leases range from $28.00 per square foot to $32.00 per square foot, significantly lower than the $70.00 to $80.00 per square foot rents of a few years ago. While much of the building has rolled to market levels, approximately 20.0% of the building exceeds current market rent levels. Moody's loan to value ratio -- LTV -- for the portion of the debt in the trust ($208 per square foot) is in excess of 100.0%. There is a $4.5 million leasing reserve, which serves as additional collateral. Total secured debt approximates $299 per square foot, substantially in excess of Moody's estimated collateral value. The borrower is an affiliate of:

The Cherry Hill Portfolio Loan, which comprises 19.0% of the pool balance, is secured by two Class B office buildings located in Cherry Hill, New Jersey. The buildings contain approximately 600,000 square feet of space. The properties continue to have significant exposure to expiring leases and tenant retention since securitization has been poor. Since securitization, the Three Executive Campus Building (434,400 square feet) lost GE Capital (197,800 square feet) and Comcast (76,000 square feet) as tenants. Stone & Webster, which leases 97,300 square feet, has vacated and its rent payments will cease in early 2005. Based on the borrower's most recent rent roll, occupancy in the first quarter of 2005 will amount to 57.3%, accounting for executed leases and forthcoming expirations. Lease proposals currently in negotiation could increase occupancy to 73.2%. The other property, Haddonfield Business Center (172,100 square feet), is currently 85.6% occupied but has 46.0% of its space expiring in 2005. While trust debt is $43 per square foot (total debt - $70 per square foot), historical tenant losses, upcoming lease expirations, and low rent achievement are causes for concern. The debt matures in December 2004 and the borrower has not indicated whether it will exercise its remaining 12-month extension option or pay off the debt. Moody's LTV is approximately 81.0% based, in part, on assumed additional lease-up.

The Key Center Loan, which represents 20.1% of the pool balance, is secured by a 435,715 square foot Class A office building located in Buffalo, New York. The property is currently 75.3% occupied, compared to 81.0% at securitization. Significant tenants include Delaware North, Key Bank USA (Moody's senior unsecured rating A1), and Ernst & Young. The borrower is an affiliate of Edwin Zafir. Current cash flow as adjusted by Moody's is $4.8 million, essentially the same as at securitization. Moody's LTV is 64.0%, the same as at securitization. The borrower has expressed its intention to pay off the loan in November 2004.

The review is prompted by Corn Products International's steady improvement in operating performance over the past few years, which has been accompanied by debt reduction, improved debt protection measures, and less reliance on subsidiary borrowings.

The review will focus on:

(i) the ability of Corn Products to sustain its improved operating performance given the competitive nature of the industry;

(ii) the company's strategies, and associated risks, for continued growth of higher margin, overseas businesses;

(iii) the prospects for continuing to improve returns on its US business; and

(iv) the evolution of its Mexican business in response to the tariff disputes.

The review will also consider the company's ongoing financial policies, including the likely extent of debt funding for its growth initiatives and acquisitions, as well as the expected degree of structural subordination of the parent company unsecured notes to outstanding subsidiary debt as the company continues to grow its overseas businesses (subsidiary debt, while materially reduced, is currently about 22% of total debt).

Corn Products International, based in Bedford Park, Illinois, is the third largest corn refiner in the world, and manufactures a variety of corn-based sweetener, starches and related products.

COTT CORPORATION: Gross Margin Dips as Production Costs Increases-----------------------------------------------------------------Cott Corporation (NYSE:COT; TSX:BCB), reported record sales for the third quarter ended October 2, 2004. The retailer brand soft drink manufacturer announced that sales for the quarter rose by 13.5% to $442.4 million. Excluding the impact of foreign exchange sales were up 11% from year ago, an increase of 7% when acquisitions are also excluded. Net income for the quarter was $22.1 million, a decrease of 14% from last year and diluted earnings per share were $0.31 vs. $0.36 last year, a decline of 14%.

"A strong top line in the US, driven by the continued growth of retailer brands there, helped drive our third quarter sales to new highs." said John K. Sheppard, Cott's president and chief executive officer. "However, as growth continued to exceed our original expectations we saw higher than expected logistical and manufacturing costs in the US again this quarter. Our number one priority is in getting these costs back in line."

On an interim basis, Sheppard would be taking on day-to-day responsibility for the US business unit, in addition to his CEO duties, while a search is conducted for a president of the US business unit. In a related move, Paul Richardson, previously responsible for the US business unit, was named to the position of EVP, Global Sourcing, where he will continue to make an important contribution.

"This is the right move for the US business and for our shareowners." said Frank E. Weise, Cott's chairman. "John has a demonstrated track record of sustained success in the US, which saw strong sales, earnings and market share growth under his leadership."

The Company reported that sales for the first nine months of the year rose to $1,277 million, up 19% from prior year, up 12% excluding the impact of foreign exchange and acquisitions. Net income increased 10% to $66.9 million from $60.8 million in the same period last year. Earnings per diluted share rose 8% to $0.93, as compared to $0.86 for last year's first nine months.

Third Quarter 2004

Sales for the third quarter were $442.4 million, an increase of 13.5% from the same period last year, up 11% excluding the impact of foreign exchange. The Company's U.S. business unit reported a 19% increase over the same period last year, an increase of 13% excluding acquisitions. Sales in the U.K./Europe business unit rose by 7%, down 5% excluding the impact of foreign exchange, while sales in Canada declined 10%, a decrease of 15% excluding the impact of foreign exchange. Sales in Mexico were $10.8 million, up from $6.9 million in the prior year.

Gross margin of 16.0% was below the prior year's 19.3%, principally due to higher logistical and plant production costs, including additional co-pack fees, inter-plant shipping costs and higher manufacturing costs. Operating income decreased by 18% to $37.9 million. Income taxes for the third quarter of $8.3 million, were favorably impacted by a $2 million reduction in accrued tax liability.

Nine Months 2004

For the first three quarters of 2004 sales rose 19% to $1.277 billion, up 16% excluding the impact of foreign exchange, an increase of 12% when both foreign exchange and acquisitions are excluded. The U.S. business unit reported a 21% gain versus the same period last year, 14.5% excluding acquisitions, while in the U.K./Europe sales were up 21% for nine months, up 7% excluding the impact of foreign exchange. In Canada, sales increased by 1%, but decreased 5% after foreign exchange is taken into account. Sales in Mexico were $29.6 million for the nine months as compared to $16 million for the prior year. Earnings per diluted share in the first nine months of this year grew by 8%, reaching $0.93 vs. $0.86 per diluted share last year.

Gross margin was 17.8% for the nine months compared to 19.4% for the same period in 2003, impacted by manufacturing and logistics costs. Operating income increased 5% to $121.5 million.

Operating cash flow for the first three quarters of 2004, including capital expenditures was $31.6 million compared with $73.1 million for the same period last year. The cash generated was primarily used to fund acquisitions.

Acquisitions

Cott's U.S. subsidiary, Cott Beverages Inc., has acquired certain of the assets of Metro Beverage Co., a soft drink manufacturer based in Columbus, Ohio and of Elan Waters, Blairsville, Georgia.These acquisitions are expected to add $15 million a year to Cott's sales. They will provide additional production capacity to help the Company address US manufacturing requirements and ensure sufficient capacity for 2005. These acquisitions increase the number of bottling plants to 11 in the US and 21 worldwide.

2004 Outlook

For the full year 2004, the company revised its earnings guidance. EPS is now expected at $1.15-$1.19, down from the $1.23-$1.27 previously announced, and EBITDA is anticipated to be between $210 and $215 million, down from prior guidance of between $220 and $225 million. Sales growth is still expected to be between 16%-19%, and CAPEX will amount to $65 million for the year.

About Cott Corporation

Cott Corporation is the world's largest retailer brand soft drink supplier, with the leading take home carbonated soft drink market shares in this segment in its core markets, the United States, Canada and the United Kingdom.

* * *

As reported in the Troubled Company Reporter on Sept. 2, 2004, Standard & Poor's Rating Services revised its outlook for Cott Corp. to positive from stable. At the same time, Standard &Poor's affirmed its 'BB' long-term corporate credit and 'B+' subordinated debt ratings on Toronto, Ontario-based Cott Corp.

Total debt outstanding was about US$362 million at July 3, 2004.

As reported in the Troubled Company Reporter on Aug. 23, 2004, Moody's Investors Service upgraded the ratings for Cott Corporation recognizing the company's strong and consistent financial and operating performance throughout the recent past and affirming Moody's expectation of continued success over the ratings horizon.

COVANTA ENERGY: Liquidation Valuation Analysis Under Lake II Plan-----------------------------------------------------------------Covanta Lake II, Inc., prepared a liquidation analysis, which reflects the projected outcome of the hypothetical, orderly liquidation of the Reorganizing Debtor under Chapter 7 of theBankruptcy Code. Anthony J. Orlando, President of Covanta LakeII, tells the United States Bankruptcy Court for the Southern District of New York that the projected liquidation proceeds to each Class were less than or equal to the estimated recoveries under the proposed Chapter 11 Plan of Reorganization.

Underlying the Liquidation Analysis are a number of estimates and assumptions that, although developed and considered by management, are inherently subject to economic, competitive, litigation and other contingencies beyond the Reorganizing Debtor and its management's control. It is possible that the time needed to dispose of the assets could exceed the timeframes assumed in the analysis, causing an adverse impact on the depicted recoveries. Similarly, other assumptions with respect to the liquidation process may be subject to change. Upon liquidation, there is a general risk of unanticipated events, which could have a significant impact on projected cash receipts and disbursements. Cash flows could be impaired due to:

-- an adverse impact on clients' and other parties' perceptions;

-- a loss of vendor support or change in terms; and

-- the cost, delay, and uncertainty of outcome of litigation with, among others, Lake County and certain other creditors.

Additionally, Mr. Orlando notes that the proceeds from the liquidation have not been discounted to reflect any delay in distributions following the completion of the liquidation process. Applying an additional discount factor to the proceeds from the liquidation to account for any delay would result in a lower range of recoveries for certain creditors. For these reasons, there can be no assurance that the values reflected in the Liquidation Analysis or recovery percentages would be realized if the Reorganizing Debtor was, in fact, liquidated under Chapter 7, and actual results could vary materially from those shown in the analysis.

Major assumptions made in the Liquidation Analysis include:

* The Chapter 7 Trustee will not operate the Facility based on the assumption that in the absence of a settlement with Lake County, the County or the bondholders will foreclose on the Facility;

* The liquidation of assets is projected to be completed between January 1, 2005, through July 1, 2005. Because the Reorganizing Debtor has no tangible assets other than the assets related to the Facility, there will be no meaningful liquidation of tangible assets;

* During the liquidation process, the Reorganizing Debtor will cease operating its business as a going concern;

* Since minimal cash is generated by the Reorganizing Debtor during the liquidation process, most if not all of the liquidation proceeds are assumed to be consumed by the liquidating trustee fees, operating expenses and other similar expenses;

* The only potential cash realizations are from litigation proceeds, the collection of energy receivables and the sale of the Reorganizing Debtor's parts inventory;

* In a Chapter 7 liquidation, there will be no agreement by Covanta Energy to voluntarily reduce the amount of its Intercompany DIP Claim or its Intercompany Administrative Expense Claim as provided in the Plan;

* All Allowed Claims will be treated in the same priority as set forth in the Plan;

* There may be a substantial increase in claims triggered by the termination of contracts under a Chapter 7 liquidation;

* Under a Chapter 7 liquidation, there will be no Settlement Agreement with Lake County. Therefore, no proceeds or benefits from the Settlement Agreement are assumed in a liquidation;

* The Settlement Agreement is assumed to have no value in a liquidation scenario; and

* The Adversary Proceeding filed by the Reorganizing Debtor against the County will survive the Chapter 7 liquidation. Due to the uncertainty in the outcome of the litigation, the value of the Reorganizing Debtor's rights in the Adversary Proceeding, if any, are too speculative to include in the Liquidation Analysis.

(d) As the Mortgage for the facility and land has been pledged to the Indenture Trustee, the Reorganizing Debtor will not have access to the foreclosed fixed assets. Additionally, there is no equity value in the fixed assets, which would remain with the Reorganizing Debtor;

(f) The Secured Bond Claims would receive recoveries from the Restricted Funds Held by the Indenture Trustee. The Bondholders may receive additional recoveries from the County and other sources, including the net proceeds, if any, received from the sale or liquidation of the Facility. Absent a service agreement with the County, net proceeds from the sale or liquidation of the Facility may be minimal; and

There can be no assurance that the values reflected in the liquidation analysis would be realized if the Reorganizing Debtor were, in fact, to undergo a liquidation, and actual results could vary materially from those shown.

Headquartered in Fairfield, New Jersey, Covanta Energy Corporation -- http://www.covantaenergy.com/-- is a publicly traded holding company whose subsidiaries develop, own or operate power generation facilities and water and wastewater facilities in the United States and abroad. The Company filed for Chapter 11 protection on April 1, 2002 (Bankr. S.D.N.Y. Case No. 02-40826). Deborah M. Buell, Esq., and James L. Bromley, Esq., at Cleary, Gottlieb, Steen & Hamilton represent the Debtors in their restructuring efforts. When the Debtors filed for protection from its creditors, they listed $3,280,378,000 in assets and $3,031,462,000 in liabilities. On March 10, 2004, Covanta Energy Corporation and its core subsidiaries emerged from chapter 11 as a wholly owned subsidiary of Danielson Holding Corporation. Some of Covanta's non-core subsidiaries have liquidated under separate chapter 11 plans. (Covanta Bankruptcy News, Issue No. 67; Bankruptcy Creditors' Service, Inc., 215/945-7000)

As of the October 18, 2004 distribution date, the transaction's aggregate balance has decreased by approximately 85.7% to $42.7 million from $297.6 million at closing. The Certificates are collateralized by two mortgage loans secured by commercial properties. Both loans are in special servicing due to balloon default. Moody's has estimated aggregate losses of approximately $12.6 million for both loans. There have been no losses to the pool since securitization.

Moody's loan to value ratio -- LTV -- for the pool is in excess of 100.0%, as it was at Moody's last full review in September 2003. Although the pool has experienced a decline in overall performance, Moody's is upgrading Classes D, E, F and G due to the significant increase in credit support for those classes. The downgrade of Classes J, K and L is due to a decline in pool performance.

The largest loan in the pool is the Summerlake Village Apartments Loan ($35.3 million - 82.6%), which is secured by an 857-unit apartment complex and a 42,000 square foot retail center located in Dallas, Texas. The loan's performance has been impacted by rental concessions and increased expenses for the multifamily component and declining rent in the retail portion. The loan was transferred to special servicing in August 2004 for pending maturity. The loan matured in September 2004. Moody's LTV is significantly in excess of 100.0%.

The second loan is the Bank One Office Building Loan ($7.5 million - 17.4%), which is secured by a 129,000 square foot office building located in Colorado Springs, Colorado. The property is 68.7% occupied, compared to 74.0% at securitization. The loan matured in January 2004 and was transferred to special servicing for maturity default. The borrower has requested an extension and has made a $550,000 principal payment. Moody's LTV is in excess of 100.0%, compared to 87.2% at last review.

Both of the loans are floating rate, indexed off of one-month LIBOR and are interest only.

DELTA AIR: Sept. 30 Shareowners' Deficit Balloons to $3.58 Billion------------------------------------------------------------------Delta Air Lines (NYSE: DAL) reported a net loss of $646 million for the September 2004 quarter compared to a $164 million net loss for the September 2003 quarter.

Excluding the non-cash charges, the September 2004 quarter net loss was $592 million. In the September 2003 quarter, Delta reported a net loss of $172 million, excluding the unusual items described below. As announced previously, Delta no longer records income tax benefits related to current period operations. This change was effective in the June 2004 quarter and will continue for the foreseeable future.

"Last month we outlined the key elements of Delta's transformation plan which targets $1 billion in annual pilot cost savings, as well as participation from Delta's other stakeholders," said Gerald Grinstein, Delta's chief executive officer. "As Delta's financial situation continues to deteriorate, time is of the essence."

Financial Performance

September 2004 quarter operating revenues increased 5.9 percent, while passenger unit revenues decreased 3.7 percent, compared to the September 2003 quarter. Continued weak domestic yields, down 5.9 percent as compared to the prior-year quarter, drove the decline in passenger unit revenues. Four major hurricanes impacted a significant portion of Delta's Southeastern operations during the quarter, resulting in an estimated revenue loss of approximately $50 million.

The load factor for the September 2004 quarter was 77.7 percent, a 1.0 point increase as compared to the September 2003 quarter. Consolidated system capacity was up 9.0 percent and Mainline capacity rose 8.7 percent from the prior-year quarter. These increases were primarily driven by the restoration of capacity that was reduced in 2003 as a result of the war in Iraq. Detailed traffic, capacity, load factor, yield and passenger unit revenue information is provided in Table 1 below.

Operating expenses for the September 2004 quarter increased 14.9 percent from the September 2003 quarter and consolidated system unit costs increased 5.4 percent. Fuel expense was the primary driver of the increase, rising 63.1 percent, or $304 million, with over 88 percent of the increase resulting from higher fuel prices. For the full year 2004, Delta expects its fuel costs to exceed the prior year levels by $950 million with $820 million of the increase driven by higher fuel prices.

"A combination of record high fuel prices and the weak domestic yield environment has materially impacted our financial results," said Michael J. Palumbo, Delta's executive vice president and chief financial officer. "This further demonstrates the urgent need for us to achieve our targeted benefits through our transformation plan."

As disclosed in the March 2004 quarter, Delta settled all of its fuel hedge contracts in February 2004, prior to their scheduled settlement dates, resulting in a deferred gain of $82 million. In the September 2004 quarter, Delta recognized a reduction in fuel expenses of $23.5 million, which represents a portion of this deferred gain. Giving effect to this deferred gain, Delta's average total fuel price for the quarter was $1.20 per gallon.

At Sept. 30, 2004, Delta had $1.77 billion in cash, of which $1.45 billion was unrestricted. Capital expenditures for the quarter were approximately $270 million, including $155 million for aircraft. Subsequent to September 30, Delta contributed its remaining 2004 funding obligation of $44 million to its defined benefit pension plan for pilots (Pilot Plan), and completed the sale of eight MD-11 aircraft and four spare engines for $227 million.

Transformation Plan

While Delta has continued to make progress on its Profit Improvement Initiatives begun in 2002, the company needs substantial further reductions to its cost structure in order to achieve viability. The company completed an extensive strategic review through which it derived its transformation plan, announced on September 8, 2004.

The transformation plan combined with the Profit Improvement Initiatives is intended to deliver approximately $5 billion in annual benefits by 2006, as compared to 2002, while at the same time improving the service offered to Delta's customers. The plan calls for participation from the company's key stakeholders, such as creditors, lessors, vendors, employees and shareowners. It should be noted that even if Delta is successful in achieving the targeted benefits from its transformation plan, the company will still have substantial liquidity needs in 2005.

In connection with its transformation plan, Delta expects to record significant one-time adjustments in the December 2004 quarter. These adjustments relate to, among other things:

(1) a gain from the elimination of the subsidy it offers for retiree and survivor healthcare coverage; and

(2) charges from voluntary and involuntary employee reduction programs. Delta cannot reasonably estimate the net impact of these adjustments at this time.

September 2004 Quarter Non-cash Charges

In the September 2004 quarter, Delta recorded two non-cash chargestotaling $54 million. These charges are:

(1) A $40 million asset impairment charge associated with our agreement to sell eight MD-11 aircraft. This charge is recorded in accordance with Statement of Financial Accounting Standards (SFAS) No. 144.

(2) A $14 million settlement charge related to the company's Pilot Plan. This charge relates to the lump sum distributions under the Pilot Plan for 61 pilots who retired. As a result of the lump sum distributions, Delta must accelerate the recognition of actuarial losses in accordance with SFAS 88. 5 Delta expects to record a settlement charge in the December 2004 quarter that is greater than the settlement charge recorded in the September 2004 quarter.

September 2003 Quarter Unusual Items

In the September 2003 quarter, Delta recorded a $9 million gain, net of tax, from the extinguishment of debt and a $1 million charge, net of tax, related to derivative and hedging activities accounted for under SFAS 133.

Consolidated Statements of Operations

Delta's Consolidated Statements of Operations for the three and nine month periods ended September 30, 2004 and 2003 show Delta's net loss as reported under Generally Accepted Accounting Principles in the United States (GAAP), as well as net loss excluding the items described above. Delta believes this information is helpful to investors to evaluate recurring operational performance because:

(1) the asset impairment and the pilot settlement charges are not representative of current period operations;

(2) the extinguishment of debt in 2003 is not representative of core operations; and

(3) the SFAS 133 charge in 2003 reflects volatility in earnings driven by changes in the market which are beyond the company's control (Delta no longer excludes SFAS 133 charges due to the reduction in our fuel hedge portfolio and other investments).

Delta Air Lines -- http://delta.com/-- is the world's second largest airline in terms of passengers carried and the leading U.S. carrier across the Atlantic, offering daily flights to 493 destinations in 87 countries on Delta, Song, Delta Shuttle, the Delta Connection carriers and its worldwide partners. Delta's marketing alliances allow customers to earn and redeem frequent flier miles on more than 14,000 flights offered by SkyTeam, Northwest Airlines, Continental Airlines and other partners. Delta is a founding member of SkyTeam, a global airline alliance that provides customers with extensive worldwide destinations, flights and services.

At September 30, 2004, Delta Air Lines' reports a $3.58 billion shareholder deficit. This compares to a $659 million shareholder deficit at December 31, 2003.

DELTA AIR: Expects Positive Economic Impact in New China Flight---------------------------------------------------------------Delta Air Lines (NYSE: DAL) said that its proposed service linking China to the Southeast in 2006 will provide an annual economic impact of almost $400 million and offer more convenient service to more cities than any other airline.

In a filing of direct exhibits with DOT as part of the 2005/2006 U.S.-China Air Services case, Delta said it expects to serve nearly 163,000 passengers in its first year of operations if the carrier is awarded the rights to provide daily, non-stop Atlanta to Beijing service beginning in March 2006.

"Delta is extremely grateful for the outpouring of support for its application so far," said Gerald Grinstein, CEO. "The DOT has received more than 12,000 letters, underlining the importance and the need for service between the growing China market and Atlanta, our nation's largest hub. These letters are from customers, 120 local and state officials, and 50 members of Congress, as well as an incredible 8,000-plus from Delta employees. As their enthusiastic response indicates, the people of Delta continue to be our company's most valuable asset, and I continue to be inspired by their unwavering commitment to this airline."

According to data in the filing from Georgia officials, China is Georgia's sixth-largest and fastest-growing export market, with more than a 220 percent increase in exports since 1999. Georgia Gov. Sonny Perdue noted in a letter to the DOT that "a new passenger service route from Atlanta to Beijing would fill a void that Georgians and the Southeast's 55 million citizens have in accessing China for business and leisure travel."

The eastern United States is currently the fastest-growing travel market to China. Delta's Atlanta to Beijing service would remedy this void and stimulate new trade and investment from the southeastern United States. The size and scope of Delta's Atlanta hub will enable non-stop-to-non-stop service to China for almost 150 U.S. communities. Of these, more than 50 U.S. communities will receive their first non-stop-to-non-stop Beijing service, and 66 U.S. communities will receive their first competitive non-stop-to-non-stop U.S.-China service. Delta's proposed service will reduce flying time for vast numbers of travelers and shippers throughout the eastern and southeastern U.S.

More than 71 percent of U.S.-Beijing passengers travel to and from interior U.S. cities. "No applicant comes close to Delta in terms of network benefits," the carrier said in its filing.

The carrier plans to use its Boeing 777 aircraft, which features Delta's award-winning BusinessElite service.

For many years, Delta has sought access to the China market. Combined with the huge connecting opportunities provided by the Atlanta hub -- the largest hub in the world -- this daily service will enable Delta to provide convenient, single-connection service to China, the carrier said.

Delta Air Lines -- http://delta.com/-- Delta is the world's second largest airline in terms of passengers carried and the leading U.S. carrier across the Atlantic, offering daily flights to 493 destinations in 87 countries on Delta, Song, Delta Shuttle, the Delta Connection carriers and its worldwide partners. Delta's marketing alliances allow customers to earn and redeem frequent flier miles on more than 14,000 flights offered by SkyTeam, Northwest Airlines, Continental Airlines and other partners. Delta is a founding member of SkyTeam, a global airline alliance that provides customers with extensive worldwide destinations, flights and services.

At September 30, 2004, Delta Air Lines' reports a $3.58 billion shareholder deficit. This compares to a $659 million shareholder deficit at December 31, 2003.

DOBSON CELLULAR: Moody's Puts B2 Rating on Planned $500M Sr. Notes------------------------------------------------------------------Moody's Investors Service assigned a B2 rating to the proposed first priority senior secured notes due 2011 and a B3 to the second priority notes due 2012 being issued by Dobson Cellular Systems, Inc., a subsidiary of Dobson Communications Corp. In addition, Moody's downgraded Dobson Communications' senior implied rating to Caa1 and its senior unsecured rating to Ca, among other ratings actions which are summarized below. The ratings outlook remains negative.

Dobson Communications Corporation

-- Senior implied rating downgraded to Caa1 from B2

-- Issuer rating downgraded to Ca from Caa1

-- $300 million 10.875% Senior Notes due 2010 downgraded to Ca from Caa1

-- $594.5 million 8.875% Senior Notes due 2013 downgraded to Ca from Caa1

The downgrade of the senior implied rating to Caa1 reflects the much weaker than expected cash flow in 2004 and beyond for the Dobson Communications family and the resulting negative consolidated free cash flows of the company. Further, the downgrade reflects the expectation that, absent material improvement in cash flow generation from the Dobson Cellular subsidiary, Dobson Communications' capital structure is unsustainable.

At Dobson Cellular Systems, the primary operating subsidiary of Dobson Communications, the B1 rating on the $75 million revolving credit facility reflects:

(i) its priority position in the company's capital structure with the only first lien claim on the accounts receivable,

(ii) inventory and other working capital assets of Dobson Cellular and its subsidiaries, and

(iii) a shared first lien claim (shared with the B2 rated notes) on all other assets.

The B2 rating on the first priority secured notes due 2011 reflects their good position in the consolidated company's capital structure, ranking behind only any outstandings under the revised $75 million revolving credit available to Dobson Cellular.

The B3 rating on the second priority secured notes due 2012 reflects their more junior position behind the Dobson Cellular revolving credit and the first priority secured notes.

Dobson Cellular and its subsidiaries serve close to 900,000 subscribers and are expected to generate just over $200 million in EBITDA (on a pro forma basis for recent transactions) in 2004. Moody's estimates interest expense to run approximately $55 million per year and capital expenditures to be $70 million per year after the completion of the company's GSM overlay. This yields interest coverage (EBITDA - capex / interest) of 2.4x, and debt/EBITDA of 3.5x at the Dobson Cellular level. In Moody's opinion, these are decent credit statistics and along with the structural seniority of all these obligations and the collateral and guarantee packages supporting these lenders, are supportive of the single-B ratings at the Dobson Cellular subsidiary.

However, those cash flow figures only yield $75 million of nominal free cash flow (EBITDA less interest and capital spending) to support Dobson Cellular's own working capital requirements and then to upstream dividends to Dobson Cellular's parent, Dobson Communications. Dobson Communications' two senior unsecured notes total $894.5 million in principal amount and require $85.4 million of annual coupon payments. While Dobson Communications has sufficient liquidity in the form of cash to meet its obligations in the near term, longer term that cash will be exhausted and as outlined above the amounts available to be upstreamed from Dobson Cellular could prove to be insufficient to meet all Dobson Communications obligations without material improvement in cash flows.

Consequently, because Dobson Cellular will be incurring more structurally senior, secured debt at the Dobson Cellular level ($700 million - or more if the proposed transaction is increased - up from $573.9 million at 2Q04), thereby further subordinating the unsecured debt at Dobson Communications, and because cash flows available to be upstreamed to Dobson Communications from Dobson Cellular are likely to be insufficient to cover Dobson Communications' debt service obligations, Moody's has downgraded the two senior unsecured notes at Dobson Communications to Ca from Caa1, and the two rated preferred stock issues to C from Caa3.

These ratings reflect the likelihood of substantial impairment (potentially above 50%) to the Dobson Communications unsecured lenders claims and the very poor prospects of any recovery for the holders of the preferred stock of Dobson Communications in a potential default scenario.

American Cellular Corporation is also a wholly owned subsidiary of Dobson Communications, but the indenture to American Cellular's 10% senior notes due 2011 severely limit cash from being upstreamed from American Cellular to Dobson Communications. Further, American Cellular posted negative free cash flow in the first half of 2004, and although Moody's expects American Cellular to be slightly free cash flow positive in 2005, such amounts are expected to be quite modest. Thus, the Dobson Communications ratings are not impacted positively or negatively by American Cellular's financial position. Moody's downgrade of the American Cellular senior unsecured notes to Caa1 from B3 reflects the weaker than expected cash flows generated by this subsidiary, American Cellular's thin liquidity, and the high probability that the company will seek to attain a small, secured bank credit facility that would rank ahead of these notes in order to bolster liquidity at this subsidiary.

Moody's is maintaining a negative rating outlook, although due to the already low levels the Dobson Communications unsecured and preferred stock ratings are unlikely to be lowered further. The senior implied rating, however, is likely to be lowered as Dobson Communications' liquidity exhausts should cash flows not increase to levels that would support all of the company's debt service obligations with a more comfortable cushion. The rating outlook could be stabilized if the longer term outlook on the parent company's liquidity improves, whether from higher levels of internally generated cash flows, or from assets sales, should these generate significant additional liquidity.

Headquartered in Oklahoma City, Dobson Communications Corp is a provider of wireless telecommunications services to suburban and rural areas of the US with 1.6 million subscribers at the end of June 2004, and LTM revenues of $950 million.

FALCON PRODUCTS: Market Cap Deficiency Spurs NYSE to Halt Trading-----------------------------------------------------------------Falcon Products, Inc., said the New York Stock Exchange had determined on Oct. 19, 2004, that the trading of Falcon's common stock on the NYSE be suspended immediately.

The decision of the NYSE was reached in view of the fact that Falcon had fallen below the NYSE's continued listing standard regarding average global market capitalization over a consecutive 30 trading day period of not less than $50,000,000 and total stockholders' equity of not less than $50,000,000.

As previously disclosed by Falcon, the NYSE accepted a plan provided by Falcon that would have brought it into conformity with this continued listing standard. However, Falcon had since been unable to meet certain material aspects of that plan. The NYSE also noted the various matters disclosed in Falcon's Form 8-K that led to the resignation of Falcon's independent public accounting firm.

Franklin A. Jacobs, Chairman and Chief Executive Officer of Falcon, stated, "We do not believe that the NYSE's decision has any significant bearing on our business and we have no plans to challenge their decision."

Falcon understands that market makers have made application to sponsor the quotation of Falcon's common stock on the Over the Counter Bulletin Board and anticipates that trading of its common stock on the OTCBB will be initiated shortly, assuming such applications are accepted.

The OTCBB is a regulated quotation service that displays real-time quotes, last-sale prices and volume information for over-the-counter equity securities. Information on the OTCBB can be found at http://www.otcbb.com/

Falcon Products, Inc. is the leader in the commercial furniture markets it serves, with well-known brands, the largest manufacturing base and the largest sales force. Falcon and its subsidiaries design, manufacture and market products for the hospitality and lodging, food service, office, healthcare and education segments of the commercial furniture market. Falcon, headquartered in St. Louis, Missouri, currently operates 8 manufacturing facilities throughout the world and has approximately 2,100 employees.

* * *

As reported in the Troubled Company Reporter on March 22, 2004, Standard & Poor's Ratings Services lowered its corporate credit rating on furniture manufacturer Falcon Products Inc. to 'CCC' from 'B-', and lowered its subordinated debt rating on the company to 'CC' from 'CCC'. The outlook is negative.

"The downgrade on St. Louis, Missouri-based Falcon Products Inc. reflects the lower than expected profitability resulting from the continued softness within the furniture segments the company serves, as well as the company's breach of certain bank covenants," said Standard & Poor's credit analyst Martin S. Kounitz.

FALCON PRODUCTS: Rubin Brown Gornstein Resigns as Accountant------------------------------------------------------------Falcon Products, Inc., reported the resignation of Rubin, Brown, Gornstein & Co. LLP as its independent public accounting firm. Rubin, Brown had been engaged by the Audit Committee of Falcon's Board of Directors on July 9, 2004.

Rubin, Brown did not render any reports on Falcon's financial statements during the period of its engagement. During the period of Rubin, Brown's engagement, there were no disagreements between Falcon and Rubin, Brown over accounting principles or practices, financial statement disclosure, or auditing scope or procedure. Rubin, Brown did bring to the attention of the Audit Committee of Falcon's Board of Directors its concerns about:

(i) certain items of information that had come to its attention that, if further investigated, might have caused it to be unwilling to rely on management's representations or be associated with Falcon's financial statements, and

(ii) certain deficiencies in Falcon's accounting controls related to accounting for inventory. The Audit Committee was aware of the deficiencies in controls and Falcon had already put in place a series of corrective actions.

Mr. Jacobs further stated, "Our Audit Committee has commenced an investigation into the matters raised by Rubin, Brown, with the assistance of independent counsel, and is actively engaged in retaining a new accounting firm. We are hopeful that the investigation and the search for a new accounting firm can be completed promptly."

Falcon Products, Inc. is the leader in the commercial furniture markets it serves, with well-known brands, the largest manufacturing base and the largest sales force. Falcon and its subsidiaries design, manufacture and market products for the hospitality and lodging, food service, office, healthcare and education segments of the commercial furniture market. Falcon, headquartered in St. Louis, Missouri, currently operates 8 manufacturing facilities throughout the world and has approximately 2,100 employees.

* * *

As reported in the Troubled Company Reporter on March 22, 2004, Standard & Poor's Ratings Services lowered its corporate credit rating on furniture manufacturer Falcon Products Inc. to 'CCC' from 'B-', and lowered its subordinated debt rating on the company to 'CC' from 'CCC'. The outlook is negative.

"The downgrade on St. Louis, Missouri-based Falcon Products Inc. reflects the lower than expected profitability resulting from the continued softness within the furniture segments the company serves, as well as the company's breach of certain bank covenants," said Standard & Poor's credit analyst Martin S. Kounitz.

FAO INC: Deal With D.E. Shaw Buys its Vote to Accept Plan---------------------------------------------------------D.E. Shaw Laminar Portfolios LLC purchased two equipment notes from Kayne Anderson Non-Traditional Investments and its affiliates for $3.9 million. Liens on furniture, fixtures and equipment in FAO Schwarz and Zany Brainy stores secure repayment of those obligations. FAO, Inc., and the Official Committee of Unsecured Creditors appointed in FAO's chapter 11 cases challenged the amount owed under the notes. D.E. Shaw, in turn, voted to reject the Company's Liquidating Chapter 11 Plan. That negative vote stalled the confirmation process.

Negotiations followed among FAO, the Committee and D.E. Shaw. Those talks culminated in an agreement to pay D.E. Shaw $3.1 million from the estate and end the debate. D.E. Shaw will then a vote for the plan. The parties ask the U.S. Bankruptcy Court for the District of Delaware to approve this compromise and settlement under Rule 9019 of the Federal Rules of Bankruptcy Procedure. The parties will ask the Honorable Joel B. Rosenthal for his stamp of approval at a hearing on October 27, 2004, on both the settlement pact and the plan of liquidation.

Earlier this year, Judge Rosenthal approved the sale of certain FAO Schwarz business assets, including its flagship store on Fifth Avenue in Manhattan, a second store in Las Vegas, and its catalog and Internet businesses, to a member of the D. E. Shaw group of companies in a transaction valued at approximately $41 million.

At August 31, 2004, FAO Inc. reported it was sitting on $38,956,855 of cash.

At June 30, 2004, the company had unrestricted cash and short-term investments of $345 million, fairly substantial for an airline of its size. However, since then, this amount has likely declined significantly, due to low load factors, weak pricing, and high fuel costs.

On June 16, 2004, the company began operating as Independence Air, a low-fare airline based at Washington Dulles Airport in Virginia. It has since terminated its relationships with United Air Lines Inc. and Delta Air Lines Inc., in which it served as a feeder partner under fee-per-departure agreements that resulted in fairly stable earnings and cash flow. Since FLYi began operating independently, it has suffered from weak load factors (only 44% in September 2004) compared with an industry average in excess of 70%.

Like other airlines, it has also been negatively affected by the ongoing weak fare environment and high fuel costs. The company has significant capital requirements over the near term, primarily substantial aircraft operating lease payments. In addition, if Delta were to file for Chapter 11 bankruptcy protection, FLYi could be responsible for lease payments on the 30 aircraft it was operating for Delta even though that relationship has ended.

FLYi will report its third-quarter earnings on Oct. 27, 2004. At that time, Standard & Poor's will be able to better assess the extent to which its liquidity has been affected in order to resolve the CreditWatch.

FORT HILL: Files Chapter 11 Plan of Reorganization --------------------------------------------------Fort Hill Square Associates and its debtor-affiliate filed their Joint Plan of Reorganization in the U.S. Bankruptcy Court for the District of Massachusetts, Eastern Division.

The Plan proposes to recapitalize the Companies' debt and equity in a structured environment and it does not consolidate the Debtors' estates. Any claim held against a particular Debtor will be satisfied solely from the cash and assets of that Debtor.

Don Chiofaro, President and Treasurer of Fort Hill, discloses that Fort Hill's entered into a new senior debt financing with Prudential Real Estate Investors and other third parties. He anticipates that the estate will secure $701 million in new financing to fund the Chapter 11 Plan and provide the Reorganized Debtors with working capital.

IP Company is the Debtors' largest secured creditor. The Plan proposes to satisfy the Debtors' obligations to IP Company -- amounting to $650 million -- using the cash coming from Prudential and another third party. The Plan delivers two New Notes to IP Property in full satisfaction of its secured claim:

* a First Payment Note in the amount of $421,000,000, bearing interest at 5% per year, and maturing in very short order; and

* a Second Payment Note in the amount of $230,830,000, bearing interest at 8% per year and maturing in five years.

The Debtors are prepared to argue that these New Notes deliver the "indubitable equivalent" to IP Company as required under the Bankruptcy Code.

will be paid in full on the latter of the Effective Date or when the claim becomes allowed.

General Unsecured creditors who will vote for the Plan will receive payment of their allowed claims on the Effective date and will receive a new contract to provide goods and services that were provided prior to the confirmation date for a term of three years

Original equity interest holders will receive an interest in the Reorganized Debtors proportional to their interests in the original equity.

Headquartered in Boston, Massachusetts, Fort Hill Square Associates, manages and develops One International Place that consists of two separate but interconnected office towers consisting of over 1.8 million square feet. The Company filed for chapter 11 protection on May 7, 2004 (Bankr. Mass. Case No. 04-13855). Alex M. Rodolakis, Esq., at Hanify & King represents the Debtors in their restructuring efforts. When the Company filed for protection from their creditors, they listed both estimated assets and debts of over $100 million.

GERDAU AMERISTEEL: Closes Offering of 70 Million Common Shares --------------------------------------------------------------Gerdau Ameristeel Corporation (TSX: GNA.TO, NYSE: GNA) completes its offering of 70 million common shares, of which Gerdau S.A., its parent, indirectly purchased 35 million common shares and the remaining 35 million common shares have been purchased by an underwriting syndicate for distribution to the public.The common shares were sold in the United States and Canada at a price of $4.70, or Cdn. $5.90, per share for total gross proceeds of $329 million, or Cdn. $413 million. If the underwriters exercise their overallotment option in full (for 5.25 million common shares) and Gerdau S.A., as it has agreed, purchases an additional 5.25 million common shares, the total gross proceeds will be approximately $378 million, or Cdn. $475 million.

The proceeds of this offering will be used to finance Gerdau Ameristeel's previously announced proposed acquisition of certain assets and working capital of four long steel product mills and four downstream facilities, which are referred to as North Star Steel, from Cargill, Incorporated, to fund capital expenditures and working capital and for general corporate purposes.

Merrill Lynch, Pierce, Fenner & Smith Incorporated and BMO Nesbitt Burns Inc. were joint book-running managers for the public offering in the United States and Canada. CIBC World Markets Corp., J.P. Morgan Securities Inc. and Morgan Stanley & Co. Incorporated acted as underwriters.

The common shares commenced trading on the New York Stock Exchange on October 15, 2004 under the symbol GNA.

Gerdau Ameristeel is the second largest minimill steel producer in North America with annual manufacturing capacity of over 6.4 million tons of mill finished steel products. Through its vertically integrated network of 11 minimills (including one 50%-owned minimill), 13 scrap recycling facilities and 32 downstream operations, Gerdau Ameristeel primarily serves customers in the eastern half of North America. The company's products are generally sold to steel service centers, fabricators, or directly to original equipment manufacturers for use in a variety of industries, including construction, automotive, mining and equipment manufacturing.

* * *

As reported in the Troubled Company Reporter on Oct. 11, 2004,Moody's Investors Service placed the ratings of Gerdau Ameristeel Corporation under review for possible upgrade in response to much- improved steel market conditions and the company's announcement of a common share offering, which, if successful, will finance the acquisition of certain assets of North Star Steel from Cargill, Incorporated. Moody's review will likely continue until the conclusion of the later of the share offering and the North Star acquisition.

The ratings were placed under review for possible upgrade:

* US$405 million of 10.375% senior unsecured notes due 2011, currently B2,

* senior implied rating -- B1, and

* senior unsecured issuer rating -- B3.

As reported in the Troubled Company Reporter on Oct. 08, 2004, Standard & Poor's Ratings Services raised its corporate credit rating on Gerdau Ameristeel Corp. to 'BB-' from 'B+'.

The bank loan rating is rated one notch higher than the corporate credit rating indicating a high expectation of full recovery of principal in the event of a default. Standard & Poor's also raised the company's senior unsecured debt rating to 'B+' from 'B'. The outlook is stable.

HEALTHCORE LLC: List of Debtors' 29 Largest Unsecured Creditors---------------------------------------------------------------HealthCore LLC and its debtor-affiliates released a list of their 29 Largest Unsecured Creditors:

Headquartered in Carlisle, Pennsylvania, HealthCore LLC provides staffing for health care facilities throughout Pennsylvania. The Company, along with its affiliates, filed for chapter 11 protection (Bankr. M.D. Pa. Case No. 04-06101) on October 8, 2004. Robert E. Chernicoff, Esq., at Cunningham & Chernicoff PC, represents the Company in its restructuring efforts. When the Debtors filed for protection from their creditors, they estimated assets of more than $500,000 and debts of more than $1 Million.

Proceeds from the proposed $125 million senior unsecured notes to be issued pursuant to Rule 144A of the Securities Act are expected to be used to repay $48 million of existing debt, acquire substantially all of the assets and assume certain of the liabilities of National Alarm Computer Center, Inc., a subsidiary of Tyco International Ltd., for about $51 million, pay fees and expenses, and provide additional liquidity to the company. The acquisition of National Alarm includes contracts to monitor alarm systems on behalf of dealers, a retail portfolio of contracts to monitor alarm systems for residential and commercial subscribers, an alarm monitoring facility and a dealer loan portfolio. The company expects to close on a new $30 million revolving credit facility due 2007 (not rated by Moody's) concurrent with the senior unsecured notes issuance to be used primarily to fund acquisitions and for general corporate purposes.

The ratings recognize:

(i) significant leverage relative to the company's small revenue base;

(iv) significant attrition rates of residential and commercial subscribers; and

(v) financial and operational risks related to the National Alarm acquisition and other prospective acquisitions.

The company has increased its revenues from about $21 million in 2001 to about $84 million in the latest twelve months -- LTM -- period ended June 30, 2004, primarily through acquisitions. The National Alarm acquisition will be the company's largest acquisition to date. Projected debt to revenues at Dec. 31, 2004 is expected to exceed 1.5 times. Moody's expects that the company will continue to focus on growth through acquisition of alarm monitoring contracts for its own portfolio and contracts monitored on behalf of dealers. The success of this strategy will depend on such factors as:

(iv) potential margin expansion from increases in the company's portfolio of alarm monitoring contracts, and

(v) limited capital expenditure requirements.

The stable ratings outlook reflects Moody's expectation that debt levels will continue to increase as the cost of alarm contract acquisitions exceeds free cash flow from operations. The ratings or outlook will likely benefit if the company demonstrates the success of its acquisition strategy through increased revenues, operating margins and improved leverage ratios. The outlook or ratings would likely come under pressure if the company fails to execute on its acquisition strategy as evidenced by growing attrition rates and deteriorating leverage ratios.

Obligations under the proposed $125 million senior unsecured notes will be guaranteed on a senior basis by all current and future subsidiaries of the company. The B3 rating on the notes, notched at the senior implied level, reflects the preponderance of senior unsecured guaranteed debt in the capital structure. The notes will be effectively subordinated to all senior secured debt of the company and its subsidiaries. The notes will be pari passu with all existing and future senior unsecured indebtedness and senior to all existing and future subordinated indebtedness.

The proposed $30 million revolving credit facility will be secured by a first priority security interest in substantially all tangible and intangible assets of the company and a pledge of 100% of the stock of its operating subsidiaries. Availability under the revolving credit facility is subject to a borrowing base based on a multiple of recurring monthly revenues from certain retail alarm monitoring contracts.

The assignment of the SGL-4 rating reflects the company's weak liquidity profile over the next twelve months. The company has significant projected cash needs including amounts required for projected alarm monitoring contract acquisitions, required debt amortization and capital expenditures. These cash needs are expected to exceed the company's cash on hand and free cash flows from operations in the next twelve months. If the company completes expected contract acquisitions and does not obtain additional financing, the company will need to rely on its $30 million revolving credit facility. Liquidity could be constrained if the integration of acquisitions is not completed successfully and in a timely manner or the company is required to fund certain loan commitments assumed in connection with the National Alarm acquisition. Integrated Alarm's revolver is expected to contain a minimum fixed charge coverage ratio covenant. Moody's expects the company to be in compliance with this covenant for the next twelve months while maintaining adequate cushion under the covenant for each quarter. The SGL rating will be sensitive to the timing and amount of contract acquisitions and the company's ability to grow free cash flow from operations.

For the LTM period ended June 30, 2004, free cash flow (defined as cash flow from operations less capital expenditures) to total debt was 9.8%. Moody's projects that free cash flow to total debt will improve to over 15% in 2005. For the LTM period, EBITDA to interest was 2.1 times and is expected to improve to about 3 times in 2005. For the LTM period, total debt to EBITDA was 3.4 times and is expected to remain over 3 times in 2005.

Headquartered in Albany, New York, Integrated Alarm is a provider of alarm monitoring services. Revenue for the LTM period ended June 30, 2004 was approximately $60 million.

JAZZ GOLF: Raising $1M from Equity Offering to Finance Growth Plan------------------------------------------------------------------The Directors of Jazz Golf Equipment Inc. reported a new common share issue through a private placement at a price of $0.08 per share. The main shareholder, ENSIS Growth Fund Inc. and the Directors and Officers of the Corporation have committed to participate in the private placement, which is expected to result in gross proceeds of approximately $1,000,000. The funds will be used to finance the Company's growth plan for the year ending August 31, 2005.

As part of the private placement the Corporation received $500,000 from ENSIS pursuant to a two-year loan, convertible to common shares at a price of $0.08 per share. The loan bears interest at the same rate as ENSIS' current loan to Jazz. ENSIS agreed to convert the loan into common shares on a matching basis. An additional investment of approximately $250,000 has been committed to the private placement by the Directors and Officers of the Corporation. The remaining balance of $250,000 is expected to be raised from existing shareholders and other qualifying investors. Additional details regarding the private placement will be announced as they are finalized.

The transaction with ENSIS is a related party transaction that is exempt from the requirements of TSX Venture Policy 5.9 pursuant to sections 5.6(8) and 5.8(5) of OSC Rule 61-501.

K&F INDUSTRIES: Launches Sr. Debt Offering & Consent Solicitation-----------------------------------------------------------------K&F Industries, Inc., is commencing a cash tender offer and consent solicitation. The Company is offering to purchase any and all of its 9-1/4% Senior Subordinated Notes due 2007 and 9-5/8% Senior Subordinated Notes due 2010. The Offers will expire at 5:00 p.m., New York City time, on November 18, 2004, unless extended or terminated. The Offers are being made in connection with the proposed acquisition of the Company by AAKF Acquisition, Inc., an affiliate of Aurora Capital Group.

In conjunction with the Offers, K&F is soliciting consents to certain proposed amendments to the indentures governing the two series of Notes, which amendments would eliminate substantially all of the restrictive covenants and certain events of default contained in the respective indentures. Adoption of the proposed amendments requires the consent of at least a majority in aggregate principal of Notes of the applicable series outstanding. The Offers and Consent Solicitations are being made pursuant to an Offer to Purchase and Consent Solicitation Statement, dated October 20, 2004, and related documents, which set forth the complete terms and conditions of the Offers and the Consent Solicitations. The Consent Solicitations will expire at 5:00 p.m., New York City time, on November 4, 2004, unless extended or terminated.

Subject to the terms and conditions of the Offers and the Consent Solicitations, holders who tender Notes pursuant to an Offer on or prior to the Consent Expiration Date will be entitled to receive an amount in cash equal to the Total Consideration applicable to such Notes. Holders who tender Notes pursuant to an Offer after the Consent Expiration Date, but on or prior to the Offer Expiration Date, will be entitled to receive only the Offer Consideration applicable to such Notes. In addition, Holders who tender Notes will receive accrued and unpaid interest with respect to such Notes up to, but not including, the applicable payment date.

The "Total Consideration" for each $1,000 principal amount of the 2007 Notes tendered and accepted for purchase pursuant to the Offer for the 2007 Notes shall be an amount equal to $1,020, comprised of:

The "Total Consideration" for each $1,000 principal amount of the 2010 Notes tendered and accepted for purchase pursuant to the Offer for the 2010 Notes shall be an amount equal to the present value on the applicable payment date of the sum of:

(i) $1,048.13 (the redemption price the Company would be required to pay per $1,000 principal amount of the 2010 Notes to redeem the 2010 Notes on Dec. 15, 2006, which is the first date on which the 2010 Notes are redeemable) plus

(ii) all scheduled interest payments per $1,000 principal amount of the 2010 Notes from the applicable payment date to the Earliest Redemption Date, such present value to be determined on the basis of a yield to the Earliest Redemption Date equal to the sum of:

(x) the bid-side yield to maturity of the 2-5/8% U.S. Treasury Note due Nov. 15, 2006, as calculated by the dealer manager in accordance with standard market practice, based on the bid price for the Reference Note as of 2:00 p.m., New York City time, two business days after the Consent Expiration Date, which is currently expected to be Nov. 8, 2004, as displayed on Page PX5 of the Bloomberg Government Pricing Monitor or any recognized quotation source selected by the dealer manager in its sole discretion if the Quotation Report is not available or is manifestly erroneous, plus

(y) 100 basis points (such Total Consideration being rounded to the nearest cent per $1,000 principal amount of the 2010 Notes ) minus

(iii) accrued and unpaid interest from the last interest payment date up to, but not including, the applicable payment date.

The $30 consent payment for each $1,000 principal amount of the 2010 Notes tendered on or prior to the Consent Expiration Date and accepted for purchase pursuant to the Offer for the 2010 Notes is included in the Total Consideration. The "Offer Consideration" for the 2010 Notes is equal to the Total Consideration minus the 2010 Note Consent Payment.

Holders who tender their Notes will be required to consent to the proposed amendments, and holders may not deliver consents without tendering their Notes. Holders who tender and consent at or at any time prior to 5:00 p.m., New York City time, on the Consent Expiration Date may not withdraw their tenders and revoke their consents at any time. Holders who tender and consent after 5:00 p.m., New York City time, on the Consent Expiration Date may withdraw their tenders and revoke their consents at any time prior to 5:00 p.m., New York City time, on the Offer Expiration Date. The Offers and Consent Solicitations are subject to the closing of the Acquisition, the completion by K&F of financing transactions to fund consummation of the Offers and Consent Solicitations and certain other customary conditions. Each Offer is not conditioned on the completion of the other Offer.

Holders should tender their Notes and deliver consents pursuant to instructions set forth in the Offer to Purchase and Consent Solicitation Statement, which is being mailed to all holders of Notes and sets forth more fully the terms and conditions of the Offers and Consent Solicitations.

Additional copies of the Tender Documents may be obtained from D.F. King & Co., Inc., the information agent, at (212) 269-5550 (banks and brokers call toll free) or (800) 628-8532 (toll free).

Lehman Brothers Inc. is the dealer manager for the Offers and the solicitation agent for the Consent Solicitations. All inquiries regarding the terms of the Offers and Consent Solicitations should be made to the Liability Management Group at Lehman Brothers Inc. at (212) 528-7581 (call collect) or (800) 438-3242 (toll free).

About the Company

K&F Industries, Inc., is one of the world's leading manufacturers of aircraft wheels, brakes and anti-skid systems for commercial, general aviation and military aircraft. The Company is also the leading worldwide manufacturer of aircraft fuel tanks as well as a producer of aircraft iceguards, inflatable oil booms and other products made from coated fabrics for commercial and military applications.

Moody's Investors Service placed the ratings of K & F Industries, Inc. under review for possible downgrade following the announcement of the proposed acquisition of the company by U.S.-based private equity firm Aurora Capital from K&F's current owners, Bernard L. Schwartz and Lehman Brothers Merchant Banking, for $1.06 billion in cash.

K&F INDUSTRIES: Moody's Reviewing Low-B Ratings & May Downgrade---------------------------------------------------------------Moody's Investors Service placed the ratings of K & F Industries, Inc. under review for possible downgrade following the announcement of the proposed acquisition of the company by U.S.-based private equity firm Aurora Capital from K&F's current owners, Bernard L. Schwartz and Lehman Brothers Merchant Banking, for $1.06 billion in cash.

The ratings review will focus on the impact of potential acquisition financing on the capital structure and credit statistics of the company post-acquisition. Specifically, Moody's will review:

(1) the extent to which additional debt is used to finance the acquisition by Aurora Capital, and the terms of the new debt securities,

(2) the earnings and cash flow outlook for the company's operations, and the company's ability to repay higher potential debt levels associated with the transaction going forward, and

(3) the company's future strategies and management structure that may ensue as the result of K&F's new ownership.

K & F Industries, Inc., headquartered in New York City, is a leading manufacturer of wheels, brakes and brake control systems for commercial, general aviation and military aircraft through its subsidiary Aircraft Braking Systems Corporation. In addition, the company is the world's leading manufacturer of flexible bladder-type fuel tanks for aircraft through its subsidiary Engineered Fabrics Corporation. 2003 revenues totaled $343 million.

Key Energy Services, Inc. (NYSE: KEG - News) released select financial data for the month ended August 31, 2004. The Company is providing this information to investors as part of the consent from the holders of the Company's 6-3/8% senior notes due 2013 and its 8-3/8% senior notes due 2008.

Total revenues $ 95,812,000 Total current assets 253,398,000 Total current liabilities 154,870,000 Long-term debt, less current portion $455,958,000

Activity Update

Activity levels for the Company's operations continue to remain strong although recent heavy rains, primarily in the Permian Basin, have had a short- term negative impact on the Company's rig hours. Weekly rig hours for the four weeks ending Oct. 16, 2004 averaged approximately 51,200. Additionally, the national pricing increases previously announced by the Company have been implemented.

Key Energy Services, Inc., is the world's largest rig-based, onshore well service company. The Company provides diversified energy operations including well servicing, contract drilling, pressure pumping, fishing and rental tool services and other oilfield services. The Company has operations in all major onshore oil and gas producing regions of the continental United States and internationally in Argentina, Canada and Egypt.

Midland, Texas-based Key had about $485 million of total debt outstanding as of June 30, 2004.

KMART CORP: $200M Synthetic Term Loan Pulled from Credit Agreement------------------------------------------------------------------On October 7, 2004, parties to that certain Credit Agreement, dated as of May 6, 2003, agreed to remove the $200,000,000 synthetic term loan portion of the facility. As a result, the facility costs that Kmart Corporation is required to pay will be reduced.

The Credit Agreement is among Kmart, as Borrower, the otherCredit Parties, the Lenders, and:

Kmart had asked the Lenders to extend a revolving credit and letter of credit facility of up to $2,000,000,000 for the purpose of funding a portion of the payments to be made by Kmart and the other Credit Parties under the Plan of Reorganization, to fund certain fees and expenses incurred by Kmart in connection with the Credit Agreement and to provide:

(a) working capital financing for Kmart and the other Credit Parties;

(b) funds for other general corporate purposes of Kmart and the other Credit Parties; and

(c) funds for other purposes permitted.

Headquartered in Troy, Michigan, Kmart Corporation (n/k/a KMART Holding Corporation) -- http://www.bluelight.com/-- is the nation's second largest discount retailer and the third largest merchandise retailer. Kmart Corporation currently operates approximately 2,114 stores, primarily under the Big Kmart or Kmart Supercenter format, in all 50 United States, Puerto Rico, the U.S. Virgin Islands and Guam. The Company filed for chapter 11 protection on January 22, 2002 (Bankr. N.D. Ill. Case No.02-02474). Kmart emerged from chapter 11 protection on May 6, 2003. John Wm. "Jack" Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP, represented the retailer in its restructuring efforts. The Company's balance sheet showed $16,287,000,000 in assets and $10,348,000,000 in debts when it sought chapter 11 protection. (Kmart Bankruptcy News, Issue No. 82; Bankruptcy Creditors' Service, Inc., 215/945-7000)

* a debt service coverage of 1.55x, * a beginning LTV of 90.2%, and * an ending LTV of 78.4%.

A copy of Standard & Poor's complete presale report for this transaction can be found on RatingsDirect, Standard & Poor's Web-based credit analysis system, at http://www.ratingsdirect.com/The presale can also be found on the Standard & Poor's Web site at http://www.standardandpoors.com/ Select Credit Ratings, and then find the article under Presale Credit Reports.

MERRILL LYNCH: S&P Affirms Class E Mortgage Cert.'s BB Rating -------------------------------------------------------------Standard & Poor's Ratings Services affirmed its rating on class E from Merrill Lynch Mortgage Investors Inc.'s series 1996-C1 and removed it from CreditWatch with negative implications, where it was placed March 23, 2004. Concurrently, the ratings on two other ratings from the same transaction are raised and two are affirmed.

The affirmation on class E reflects the repayment of prior interest shortfalls following the liquidation of an outlet center in Eddyville, Kentucky. The shortfalls resulted when final liquidation proceeds were not sufficient to repay outstanding advances.

The raised and affirmed ratings reflect credit enhancement levels that adequately support the ratings through various stress scenarios.

As of the Sept. 25, 2004 remittance report, the pool consisted of 67 loans with an aggregate principal balance of $225.9 million, down from 159 loans totaling $647.2 million at issuance. The master servicer, GMAC Commercial Mortgage Corp., provided 2003 net cash flow -- NCF -- debt service coverage -- DSC -- figures for 63% of the pool. Based on this information, Standard & Poor's calculated a weighted average DSC of 1.39x, whereas the DSC for the outstanding loans at issuance was 1.36x. Nineteen loans, comprising 20% of the pool, are not required to report financials. To date, there have been realized losses on five loans totaling $20.7 million.

As of September 2004, there are three specially serviced mortgage loans totaling $8.6 million (3.8%). In addition to the specially serviced loans, there is another loan that is 30 days delinquent ($6.3 million) that is with the master servicer.

Two of the specially serviced assets are 90-plus days delinquent. One of the 90-plus day delinquent loans has a balance of $3.9 million (with total exposure of $4.2 million), and is secured by a 61,304 square foot outlet center in Post Falls, Idaho. Occupancy levels at the center have fallen to 51%, resulting in a DSC of 0.26x. The declines in occupancy and DSC are due to increased competition from Wal-Mart as well as surrounding competition. The only two national tenants are Dress Barn and Casual Corner, the second of which is on a year-to-year lease. Based on a February 2004 appraisal, a severe loss is expected. The other 90-plus day delinquent loan has a balance of $1.6 million and is secured by a 118-room hotel in Little Rock, Arkansas. A recent appraisal suggests losses upon disposition. The remaining specially serviced loan has a balance of $3.3 million. The loan matured in April 2003 and is in the process of finalizing a second extension through April 2005. The loan is secured by a 242,500-sq.-ft. office/industrial warehouse property in Hutchins, Texas (southeast of downtown Dallas) that was built in 1986.

The 30-day delinquent mortgage totals $6.4 million, and is secured by a 440-unit apartment complex in Dallas, Texas, built in 1982. The borrower has expressed interest in paying off the mortgage. GMAC Commercial received a commitment letter, and estimates the payment date to occur before year-end. As of March 2004, the property reported a 1.06x (year-to-date) DSC, down from 1.29x at issuance. Occupancy levels for the same periods were 71% and 91%, respectively.

GMAC Commercial reported 25 loans totaling $79.4 million (31.7% of the pool) on its watchlist. The watchlist includes three of the top 10 mortgages in the pool, which appear because of DSC issues, as well as one 30-day delinquent mortgage.

The fourth-largest loan has a balance of $9.6 million. The mortgage is secured by a 376-unit multifamily property in Las Vegas. GMAC Commercial reported occupancy of 87% and DSC of 1.15x, down from 92% and 1.28x, respectively, at issuance. The owner has made the expenditures to improve the occupancy levels.

The fifth-largest mortgage totals $7.7 million, and is secured by a 360-unit apartment complex in Denton, Texas (60 miles northwest of Dallas), built in 1985. As of May 2004, occupancy was reported at 83%, resulting in a DSC of 1.04x, down from 96% and 1.30x, respectively, at issuance. Management has increased occupancy levels to 94% (as of September 2004) by offering concessions.

The sixth-largest loan has a balance of $7.2 million, and is secured by a 253-unit multifamily property in Fort Collins, Colorado. As of December 2003, occupancy was reported at 75%, resulting in DSC of 0.65x, down from 98% and 1.36x, respectively, at issuance. The decline in performance is largely the result of the low interest rate environment, resulting in decreased demand for rental housing.

The pool is geographically diverse, with properties located in 24 states. Concentrations in excess of 10% exist in:

Standard & Poor's stressed the specially serviced, watchlist, and other loans in the pool that appeared to be underperforming. The resultant credit enhancement levels support the raised and affirmed ratings.

METRIS MASTER: Fitch Pares Ratings on Six Debt Classes to Low-B---------------------------------------------------------------Fitch Ratings affirms ratings for the class A securities and upgrades class B and class C securities issued from Metris Master Trust. The rating actions, which affect approximately $2.05 billion of credit card backed securities, reflects stabilizing trust credit quality metrics and Metris Companies Inc.'s progress in addressing near-term liquidity risks, as well as accounting, regulatory, and servicing concerns. These actions do not affect any series issued that are insured by MBIA, Inc.

Since Fitch's last rating action, key trust performance metrics have continued to show improvements. While still at elevated levels, trust vintage default rates appear to have declined from their peaks, and delinquency trends have posted improvements in recent months. Trust credit quality has continued to improve with trust reported losses averaging 18.48% year-to-date in 2004, compared with 20.62% in 2003 and 15.82% in 2002. Delinquencies of 60 plus days for the most recent reporting period were at 9.74%, compared with 11.23% in the December 2003 reporting period. Driving this improvement has been:

Fitch expects that further improvement in trust credit quality metrics will remain challenged by the denominator effect caused by portfolio attrition and limited new account growth. Residual effects of older, weaker, performing vintages will continue to represent a significant proportion of the trust receivable base. Positively, trust-reported gross yield has been relatively stable and in-line with historical performance, averaging 26.79% over the past 12 months, while the monthly payment rate has shown improvement with the past 12-month average of 7.43%.

The master trust has experienced improving excess spread levels, which have increased from historical lows in 2003. Driving this improvement has been:

Excess spread levels have increased steadily since the beginning of 2004, with the October 2004 period reporting one-month and three-month average excess spread at 5.22% and 5.56%, respectively. The improvement in excess spread has allowed for spread account deposit to be released back to the company. After reviewing the stress scenarios, Fitch believes available credit enhancement is commensurate with newly assigned ratings. As such, ratings on outstanding trust series are adjusted as indicated below.

While Fitch recognizes relative improvements in terms of performance metrics as well as liquidity, Metris will remain challenged as a niche credit card issuer in a competitive market. Fitch also remains concerned with the company's ongoing Securities and Exchange Commission investigation of the company's SEC fillings in 2001 and Internal Revenue Service review of the company's tax strategy. Fitch will continue to monitor management's assessment of these items.

On Oct. 8, 2004, Fitch upgraded the senior debt rating of Metris to 'B-' from 'CCC'. Ratings of Direct Merchants Credit Card Bank, N.A. are affirmed at a long-term 'B' and short-term 'B'. The Rating Outlook for Metris and DMCCB is Stable. This action affected approximately $150 million of outstanding unsecured debt. The ratings upgrade primarily reflects the company's improving operating performance coupled with strengthened liquidity, which Fitch believes will be sustainable over the near to intermediate term.

METROPCS INC: Solicits Waivers from Senior Noteholders-------------------------------------------------------MetroPCS, Inc., is soliciting consents from the holders of its $150.0 million aggregate principal amount of outstanding 10-3/4% Senior Notes due 2011 to a limited waiver, for up to 180 days, of any default or event of default arising from a failure by MetroPCS to file with the Securities and Exchange Commission, and furnish to the holders of notes, reports required to be filed pursuant to the Securities Exchange Act of 1934. Holders of the notes are referred to MetroPCS' Consent Solicitation Statement dated October 20, 2004 and the related Letter of Consent for the detailed terms and conditions of the consent solicitation.

MetroPCS retained Bear, Stearns & Co. Inc. to serve as its solicitation agent and Mellon Investor Services LLC to serve as the information agent and tabulation agent for the consent solicitation. Questions concerning the terms of the consent solicitation should be directed to:

Banks and brokers may call the tabulation agent at (201) 329-8794, and all others may call (877) 698-6870.

This announcement is not an offer to purchase or sell, a solicitation of an offer to purchase or sell or a solicitation of consents with respect to any securities. The solicitation is being made solely pursuant to MetroPCS' Consent Solicitation Statement dated October 20, 2004 and the related Letter of Consent.

About MetroPCS, Inc.

Dallas-based MetroPCS, Inc. is a wholly owned subsidiary of MetroPCS Communications, Inc. and a provider of wireless communications services. Through its subsidiaries, MetroPCS, Inc. holds 18 PCS licenses in the greater Miami, San Francisco, Atlanta and Sacramento metropolitan areas. MetroPCS offers customers flat rate plans with unlimited anytime local and long distance minutes with no contract. MetroPCS is among the first wireless operators to deploy an all-digital network based on third generation infrastructure and handsets. For more information, visit the MetroPCS web site at http://www.metropcs.com/

* * *

As reported in the Troubled Company Reporter on Oct. 13, 2004, Standard & Poor's Ratings Services revised its outlook on Dallas, Texas-based wireless service provider MetroPCS Inc. to negative from positive. The outlook revision reflects two concerns.

"First, the company is rapidly approaching the Nov. 8, 2004, deadline for filing its second-quarter SEC Form 10-Q in order to avoid triggering a technical default, which could result in acceleration in repayment of about $150 million of 10.75% senior notes due 2011. Such acceleration could lead to a liquidity issue in the near term," said Standard & Poor's credit analyst Michael Tsao.

The delay in filing was caused by an ongoing internal investigation into understatement of revenues and net income for the quarter ended March 2004 (the accounting problem also caused the withdrawal of a plan for an IPO).

Second, the accounting problem may be wider in scope than initially expected by Standard & Poor's, given that the company recently fired its principal accounting officer and announced that previously issued financial statements for the years ended in December 2002 and 2003 and subsequent interim period should not be relied upon. The accounting problem and any associated internal control issue could lead to regulatory ramifications.

MORGAN STANLEY: Moody's Places Ba2 Rating on Class $9.4M G1 Certs.------------------------------------------------------------------Moody's Investors Service upgraded the ratings of two classes, downgraded the rating of one class and affirmed the ratings of two classes of Morgan Stanley Dean Witter Capital I Inc., Commercial Mortgage Pass-Through Certificates, Series 2002-XLF:

The Certificates are collateralized by three whole loans and one senior participation interest, which range in size from 24.7% to 42.1% of the transaction based on current principal balances. As of the October 5, 2004 distribution date, the transaction's aggregate certificate balance has decreased by approximately 74.3% to $251.1 million from $976.3 million at securitization due to the payoff of five loans initially in the pool and amortization associated with four loans.

Classes A through F are pooled classes, which benefit from pool diversity, while Classes G1, G4 and G5 depend on the performance of a specific loan for debt service and ultimate repayment. Moody's rates pooled classes A through C as well as two of the three remaining rake classes offered.

Moody's current weighted average loan to value ratio -- LTV -- is 68.1%, compared to 66.8% at securitization. Classes B and C have been upgraded due to increased credit support. Class G1 has been downgraded to reflect the poor performance of the Westbrook Portfolio Loan. Class G4 pertains to the Hilton Portfolio Loan and is affirmed.

The top two loans represent 75.3% of the outstanding trust balance. The largest loan is the Westbrook Portfolio Loan ($105.5 million -- 42.1%). The loan, which is interest only through its initial maturity date of August 2005, is secured by 18 office buildings located in eight separate metropolitan areas:

The loan balance has decreased by approximately 44.4% since securitization due to the payment of release premiums associated with the release of nine buildings. At securitization the portfolio had a total area of approximately 3.8 million square feet, compared to the current total area of approximately 2.4 million square feet, representing a 36.8% reduction in size. At securitization the loan amount per square foot was $50.00, compared to $44.00 currently. As of August 2004 the portfolio was approximately 59.6% leased (63.0% - 2003, 69.5% - 2002) compared to 78.1% at securitization. The weakness in the Denver, Columbus and suburban Chicago office markets has been a contributing factor to the portfolio's current reduced occupancy level. The loan has two one-year extension options beyond its August 2005 maturity date. The floating rate loan requires monthly amortization of 0.10% of the outstanding loan amount during any extension term. A mezzanine loan in the amount of $62.8 million is held outside the trust. Moody's LTV excluding the mezzanine loan is 71.3%, compared to 65.2% at securitization. The loan is shadow rated Ba2, compared to Baa3 at securitization.

The second largest exposure is a senior participation interest in the Hilton Portfolio Loan ($83.5 million -- 33.2%), which is secured by four full-service hotels including the Miami Airport Hilton, Hilton Costa Mesa, Hilton Suites Auburn Hills and Embassy Suites Portland. The hotel portfolio has a total of 1,484 rooms. The hotels are located in four states -- Florida, California, Michigan, and Oregon. For the five-month period ending June 2004, the portfolio had a weighted average occupancy of 77.5% and RevPAR of $81.18. The loan is a senior participation with a $14.0 million junior participation held outside the trust. This floating rate loan was interest only through December 2002, with amortization based on a 25-year schedule through loan maturity in October 2006. Moody's LTV is 65.7%, essentially the same as at securitization. The loan is shadow rated Baa3, the same as at securitization.

The third largest loan is the Treasure Coast Loan ($61.9 million -- 24.7%) secured by the Treasure Coast Square Mall, an 871,690 square foot enclosed regional mall in Jensen Beach, Florida. The subject mall is the only regional mall and dominant middle-market retail center serving the greater Fort Pierce MSA. The mall is anchored by:

The collateral includes only the J.C. Penney and Sears stores totaling 220,776 square feet, and the in-line space totaling 360,318 square feet. The in-line space was 75.5% occupied as of June 2004, compared to 80.2% at securitization. Comparable in-line sales were $387 per square foot in 2003, compared to $309 at the time of securitization. This floating rate loan is interest only with a maturity date of January 2006 with no extension options. The loan sponsor is Simon Property Group (Moody's preferred stock rating Baa3). Moody's LTV is 66.0%, compared to 72.4% at securitization.

Proceeds from the new bank loan principally will refinance the existing term loan and 8.5% senior subordinated note (2008) issue.

The ratings reflect the secular changes in the supermarket industry that are causing weak sales at most conventional grocery retailers and Moody's expectation that the company will increase shareholder returns. However, Moody's belief that part of discretionary free cash flow will be used to improve the balance sheet and the company's position as an important grocery supplier to independent supermarkets and military commissaries benefit the ratings. The rating outlook is stable.

The rating assigned is:

-- $300 million secured bank loan at B1.

Ratings affirmed are:

-- Senior Implied Rating at B1, and the -- Issuer Rating at B2.

Moody's will withdraw the rating on the $165 million issue of 8.5% senior subordinated notes (2008) following completion of this transaction.

In spite of good debt protection measures for the assigned ratings, the secular changes in the supermarket industry in which non-traditional grocery retailers are capturing significant market share, the company's geographic concentration in the slow-growth Great Plains and Upper Midwest regions, and Moody's expectation that Nash Finch will increase shareholder returns over the next several years limit the ratings. Moody's believes that retail sales of Nash Finch and its wholesale customers, along with most other conventional wholesalers and retailers, have permanently weakened because of increased competition from non-traditional grocery retailers such as the supercenters.

However, the ratings consider the anticipated good liquidity position and Moody's expectation that the company will annually prepay at least $20 million of debt. The company's status as an important grocery wholesaler in the Great Plains and Upper Midwest regions, Nash Finch's leading market share as a grocery supplier to military installations along the East Coast and in Europe, and our belief that sales growth in the wholesale segment will at least offset the expected decline of the retail segment also benefit the ratings.

The stable rating outlook anticipates that the company will modestly improve its financial profile as it emphasizes its wholesale and military segments relative to the pressured retail segment. Ratings would be negatively impacted if retail performance at corporate and customer supermarkets does not stabilize, Nash Finch cannot build on its strong position as a grocery distributor for supermarkets and military commissaries, or the company does not prepay the bank loan with discretionary free cash flow. Over the longer term, ratings could be raised as debt protection measures improve (such as lease-adjusted leverage falling toward 3 times) and the company takes advantage of opportunities in the consolidating grocery distribution industry.

The B1 rating on the proposed secured Bank Loan (to be comprised of a $100 million Revolving Credit Facility and a $200 million Term Loan B) considers that substantially all assets of the company and its subsidiaries provide collateral. The arranger -- Nash Finch Company -- directly owns most assets and carries out the majority of operations, but the debt also enjoys the guarantees of the operating subsidiaries. While there is no scheduled Term Loan amortization before maturity, the bank agreement requires prepayment with a portion of defined excess cash flow. The dividend payout ratio is limited to 25%. This bank loan is rated at the same level as the senior implied rating because secured debt comprises most debt, in spite of Moody's opinion that sellable assets fully cover the bank loan.

Going forward, Moody's expects that Nash Finch will increasingly emphasize the wholesale division relative to the retail division. Retail operating margin and average unit volume have substantially declined relative to prior years as competition from non-traditional grocery retailers has increased. The company has closed 22 poorly performing stores over the past two quarters. In contrast, distribution margin and revenue have grown partially due to new account wins over the last eighteen months as Fleming, the largest grocery wholesaler, has liquidated. Pro-forma for the pending capital structure, Moody's calculates that lease adjusted leverage (using gross rent expense) equaled about 4 times and fixed charge coverage was around 3 times. Moody's expects that free cash flow will grow going forward as the company reduces investment in the retail segment and focuses on growing volume in the wholesale segment, which has substantial overcapacity.

Nash Finch Company, headquartered in Edina, Minnesota, is a leading grocery distributor to retailers and military commissaries and operates 88 retail stores in the Upper Midwest and Great Plains regions of the United States. Revenue for the 12 months ending June 2004 was about $4.0 billion.

NEW HAVEN FOUNDRY: Preference Suit Helps Tank Yale Industries-------------------------------------------------------------Kenneth A. Nathan, the Chapter 7 Trustee overseeing the liquidation of New Haven Foundry, Inc., sued Yale Industries Inc. to recover an alleged $1,000,000 preference payment. Yale believes New Haven received the prepetition payments in the ordinary course of business for the services performed on castings and shipped to Chrysler Corporation, and will defend the lawsuit on that basis.

This week, Margate Industries, Inc. (Pink sheets: CGUL.PK) announced that it intends to begin a voluntary liquidation of Yale Industries Inc. because that litigation and two other major bankruptcy filings in the foundry industry have put too much pressure on its business.

New Haven Foundry, Inc., filed for bankruptcy on November 27, 2001 (Bankr. E.D. Mich. Case No. 01-62954) and is liquidating under chapter 7. The Trustee has indicated in papers filed with the bankruptcy court that funds should be available for distribution to New Haven Foundry's unsecured creditors.

NORTHWEST AIRLINES: Reports $46 Million Third Quarter Loss----------------------------------------------------------Northwest Airlines Corporation (Nasdaq: NWAC), the parent of Northwest Airlines, reported a $46 million third quarter net loss. This compares to the third quarter of 2003 when the airline reported a net profit of $42 million.

Doug Steenland, president and chief executive officer, said, "As in recent quarters, our operating performance was negatively impacted by record high fuel cost that continues to drive the dynamics of the airline industry. As an example of our efforts to address high fuel prices, on Tuesday we expanded a $10 each-way fuel surcharge to nearly all of our domestic fares."

"Northwest continued to perform well against its major competitors by maintaining an industry-leading revenue premium and a strong cash balance. Our strong positions in domestic heartland markets and our international passenger and cargo operations benefited us during the quarter. We also continued our aggressive drive to reduce non-labor costs." He continued, "Operationally, the airline ran well during the third quarter. I want to thank the 38,000 employees of Northwest who provided reliable customer service during the peak summer months."

"Concerning labor cost restructuring, as anticipated, we have announced a tentative two-year agreement with our pilots. The proposed agreement, subject to ratification by Northwest pilots and a satisfactory restructuring of our revolving credit facility, includes $300 million in annual labor cost savings from pilots and salaried workers."

"As scheduled, we are now in contract discussions with ground workers represented by the International Association of Machinists and Aerospace Workers (IAM), and flight dispatchers represented by the Transport Workers of America (TWU). In addition, preliminary contract discussions will start shortly with the Aircraft Mechanics Fraternal Association (AMFA), the Professional Flight Attendants Association (PFAA), Northwest Airlines Meteorology Association (NAMA), and Aircraft Technical Support Association(ATSA)," Steenland added.

Financial Results

Operating revenues in the third quarter increased 13.4% versus the third quarter of 2003 to $3.05 billion.

Operating expenses increased 16.8% versus a year ago to $2.97 billion. Unit costs excluding fuel increased by 1.1%. During the quarter, fuel averaged $1.24 per gallon, up 64.6% versus the third quarter of last year.

"Northwest continues to execute its long-term business strategy in part by continuing to maintain one of the strongest cash balances in our industry. We are working with our bank partners to restructure our $975 million revolving credit facility well in advance of its scheduled maturity," said Bernie Han, executive vice president and chief financial officer.

Northwest's quarter-end cash balance was $2.68 billion, of which $2.54 billion was unrestricted.

New Top Executive

Northwest Airlines announced on October 1 that its board of directors had elected Doug Steenland, the airline's president, to the additional position of chief executive officer following the decision of Richard Anderson to join UnitedHealth Group.

Mr. Steenland, who joined Northwest in 1991, was elected president and named to the company's board in 2001.

SkyTeam Alliance

In mid-September, Northwest, Continental Airlines and KLM Royal Dutch Airlines became full members of the SkyTeam global airline alliance. The three new carriers add to SkyTeam's extensive network of hub airports and destination cities, allowing member airlines to provide their passengers with increased travel options. The three new members add 10 additional hub locations and 141 new destinations to the SkyTeam network. Northwest's entry into SkyTeam provides its customers with greater frequent flyer mileage accrual and redemption possibilities. Customers traveling with any of the nine member airlines can earn miles toward WorldPerks Elite status and redeem miles on any of the nine airline members. In addition, Northwest customers enjoy other SkyTeam benefits, including one-stop check-in for connectingflights.

One issue that continues to affect Northwest is the heavy burden of taxation. "Our ability to return to profitability is hampered by the amount of taxes and fees that we must impose on passenger tickets. In the case of Northwest Airlines, we paid $325 million in transportation taxes and fees during the third quarter to various government entities. We are continuing to work with federal officials in an effort to minimize ticket taxes on anindustry that has an even greater tax burden than alcohol and tobacco," Steenland added.

Northwest Airlines will webcast its third quarter results conference call at 11:30 a.m. Eastern Daylight Time (10:30 a.m. Central) today. Investors and the news media are invited to listen to the call through the company's investor relations Web site at http://ir.nwa.com/

About Northwest Airlines

Northwest Airlines is the world's fourth largest airline with hubs at Detroit, Minneapolis/St. Paul, Memphis, Tokyo, and Amsterdam, and approximately 1,500 daily departures. Northwest is a member of SkyTeam, a global airline alliance partnership with Aeromexico, Air France, Alitalia, Continental Airlines, CSA Czech Airlines, Delta Air Lines, KLM Royal Dutch Airlines, and Korean Air. SkyTeam offers customers one of the world's most extensive global networks. Northwest and its travel partners serve more than900 cities in more than 160 countries on six continents.

The notes and bank credit facilities are expected to comprise the financing for NorthWestern's exit from Chapter 11. The bank credit facilities are expected to be evenly split between a 7-year term loan B facility and a 5-year revolving credit facility.

Moody's also assigned a Ba1 rating to approximately $280 million of the prepetition senior secured debt that will be reinstated upon exit from bankruptcy. Furthermore, Moody's assigned a Senior Implied Rating of Ba1, an Issuer Rating of Ba2, and an SGL-2 rating. The rating outlook for NorthWestern is stable.

NorthWestern expects to complete its Chapter 11 bankruptcy proceedings and emerge as a reorganized entity within 30 days. The company's second amended and restated plan of reorganization received written confirmation from the Bankruptcy Court. Under the Plan, the company's prepetition senior secured creditors and trade vendors with claims of less than $20,000 will get 100% recovery. Approximately $1.3 billion of senior unsecured and subordinated debt will be extinguished and exchanged for $710 million of equity.

Proceeds from the planned note offering and the term loan, along with cash on hand will be used to repay the balance due under the company's existing senior secured bank credit facility. The new revolver will initially be used to provide some $15 million of letters of credit. The remaining balance under the revolver will be available to meet general working capital needs.

(2) significant improvement in the capital structure that is expected to result from the debt-for-equity exchange embodied in the Plan;

(3) a significant shift in management's strategy back to the basics of its core regulated electric and gas utility business, which should provide generally stable and predictable cash flows; and

(4) improved regulatory relationships, including a settlement that affords more protections for investors from riskier non-regulated investments.

The company also faces significant challenges, which include:

(1) resolving various lawsuits and an investigation being conducted by the Securities and Exchange Commission;

(2) regulatory uncertainty that might still exist in Northwestern's Montana service territory;

(3) completing remaining non-utility asset sales, proceeds from which we expect will be used to reduce debt;

(4) renegotiating contracts with qualifying facilities, which form part of the default supply portfolio in Northwestern's Montana service territory;

(5) uncertainty surrounding the Montana Public Service Commission's periodic review of the prudency of electric and natural gas purchases, which could result in potential under recovery of default supply costs; and

(6) cash funding to shore up the pension fund.

Northwestern's business risk profile will improve considerably upon emergence from bankruptcy, as management is in the final stages of satisfying conditions necessary to release funds from its divestiture of non-regulated investments that contributed significantly to its financial difficulties and eventual bankruptcy.

The Ba1 rating for NOR's senior secured debt considers the benefits of the collateral. The collateral under the Montana and South Dakota/Nebraska first mortgage bond -- FMB -- indentures is comprised of a first mortgage lien on substantially all of Northwestern's utility property, subject to the exclusion of certain real property and assets that is typical in FMB indentures. The rating of the senior secured debt is not notched up from the Ba1 Senior Implied Rating. This takes into consideration that virtually all of the company's debt will initially be secured under the FMB indentures, as well as the simplified business and legal structure of the reorganized Northwestern.

The SGL-2 rating reflects the company's liquidity profile over the next 12 months. This is supported by the company's intention to keep $10 million of unrestricted cash on hand, which in combination with expected free cash flow after capital expenditures and dividends significantly exceeds scheduled debt maturities. The SGL-2 also takes into account that the company is expected to have a 5-year bank revolver that will be largely unused and appears to have reasonable head room under the covenants.

Moody's expects Northwestern's ratio of funds from operations to debt to average in the 15% to 20% range over the next few years. Upon emergence from bankruptcy, the company's capital structure will initially be comprised of approximately $850 million of debt and $710 million of common equity. Moody's expects debt reduction to occur as NOR uses its excess cash to repay maturing debt over the next few years.

The stable rating outlook for Northwestern reflects the company's lower-risk "back-to-basics" strategy to focus on the business of being an electric and gas utility. It also considers recent regulatory rulings designed to limit the scope of non-regulated activities in the future.

The Honorable Charles G. Case II of the U.S. Bankruptcy Court for the District of Delaware entered a written order confirming NorthWestern Corporation's Second Amended and Restated Plan of Reorganization earlier this week. NorthWestern anticipates the Plan's effective date will be Nov. 1, 2004, at which time the company will formally exit Chapter 11 reorganization. As previously announced, the court issued an oral ruling confirming the Plan on Oct. 8, 2004.

OLD UGC: Files First Amended Joint Plan of Reorganization ---------------------------------------------------------Old UGC, Inc., and UnitedGlobalcom, Inc., filed with the U.S. Bankruptcy Court for the Southern District of New York their First Amended Joint Plan of Reorganization.

The Plan is the result of months of meetings and negotiation among the Debtor and its two largest creditors -- UnitedGlobalCom and IDT United, Inc. The Plan intends to restructure Old UGC's 10.75% Senior Secured Discount Notes due on 2008.

The Plan provides that on the Effective Date, Old UGC will exchange shares of its Class A Common Stock for all outstanding Senior Notes held by IDT United and shares of its Class B Common Stock for all outstanding Senior Notes in the aggregate amount of $700 million held by UnitedGlobalCom.

The Debtor will issue to IDT shares of Class A Common Stock equal in number to its pro rata share of New Common Stock in exchange for $599 million in principal amount at maturity of its senior notes.

Senior Notes held by the public and Old UGC common stock will be reinstated and all accrued interest will be paid in cash.

Headquartered in Denver, Colorado, Old UGC, Inc.-- http://www.UnitedGlobalcom.com/-- is one of the largest broadband communications providers outside the United States and provides full range of video, voice, high-speed Internet, telephone and programming services. The Company filed for chapter 11 protection on January 12, 2004 (Bankr. S.D.N.Y. Case No. 04-10156). David A. Levine, Esq., at Cooley Godward, LLP and Jay R. Indyke, Esq., at Kronish Lieb Weiner & Hellman, LLP represent the Debtors in their restructuring efforts. When the Company filed for protection from their creditors, they listed $846,050,022 in total assets and $1,371,351,612 in total debts.

OUTBOARD MARINE: 7th Cir. Says Faxed Proof of Claim Was a Mistake-----------------------------------------------------------------The United States Court of Appeals for the Seventh Circuit handed down a ruling this week that tells Travis Boats & Motors, Incorporated, it was a big mistake to fax its $1,138,216.90 proof of claim against Outboard Marine Corporation on the day claims were due.

Travis Boats received a Notice in the mail in late-August 2002 directing Outboard Marine's creditors to mail their proofs of claim to a designated post office box so as to be received by the claims agent by November 15, 2002. Travis Boats didn't follow those instructions and didn't give the 7th Cir. any good reason for not following those instructions. Travis Boat faxed its proof of claim to counsel for the chapter 7 trustee on November 15, 2002. The trustee, in turn, mailed it to the claims agent. The claims agent received the faxed document on Nov. 21 -- six days late.

The chapter 7 trustee objected to the late-filed claim and the Bankruptcy Court sustained the Trustee's objection. Travis moved for reconsideration; the Bankruptcy Court declined the invitation. Travis appealed to the District Court, but its plea fell on deaf ears.

On appeal to the 7th Cir., Travis Boats argued that it complied with the Notice of Bar Date by faxing its proof of claim to the OMC claims agent on the Bar Date. In the alternative, Travis Boats asserted that its faxed claim should be deemed timely pursuant to Rule 5005(c) of the Federal Rules of Bankruptcy Procedure, or that its claim should be characterized as a timely-filed informal claim. In addition, Travis Boats maintained that the courts below erred in disallowing the claim, instead of subordinating the claim under 11 U.S.C. Sec. 726(a)(3).

The 7th Cir. says Travis' compliance argument is unpersuasive. The Notice was clear and Travis didn't follow instructions. The 7th Cir. rejects Travis' equitable arguments because they weren't raised in the lower courts. The 7th Cir. agrees, however, that the claim should not be disallowed. Section 726(a)(3) of the Bankruptcy Code provides that tardy unsecured claims are subordinated to timely-filed unsecured claims. So, Travis hold an allowed unsecured tardy claim that can be paid after all timely-filed unsecured claims are paid in full, which is a very unlikely result.

Type of Business: The Company is a major provider of containment, sorting, rework, repack, inventory management, material handling, warehousing, distribution, customer representation, sequencing and subassembly services for automotive manufacturers, Tier One suppliers, and other industries. See http://www.psaquality.com/

"Proceeds from the transaction will be used to help fund the acquisition of the company by Audax Group in a very aggressively leveraged transaction," said Standard & Poor's credit analyst Wesley E. Chinn.

(a) North Carolina, (b) South Carolina, and (c) southern Virginia, and

(2) strong operating margins.

Ready-mixed concrete (a stone-like compound that results from combining aggregates--such as gravel, crushed stone, and sand--with water, various admixtures, and cement) is a fragmented, consolidating industry with about 2,500 independent producers. This fragmentation and relatively low-- albeit increasing --barriers to entry to new ready-mix concrete manufacturing operations contribute to highly competitive market conditions. Demand for ready-mixed concrete depends on the level of construction activity in a given geographic market. Because the market for a ready-mix plant generally is the area within a 25-mile radius, results are susceptible to swings in the level of construction activity occurring in local residential, commercial, street and highway, and other public infrastructure markets.

Ready Mixed Concrete's revenue base doubled to $150 million last year with the acquisition of Unicon Concrete in late 2002 for $64 million. Aided by this and other acquisitions in recent years and price and volume increases, a meaningful rise in revenues to the $160 million to $170 million for 2004 is likely. Still, Ready Mixed Concrete's revenue base remains modest compared with other rated competitors. Operations are limited geographically, which increases the potential for financial volatility arising from regional economic conditions and local seasonal weather fluctuations that influence the level of construction activity.

SELECT MEDICAL: Merger News Cues Moody's to Review Low-B Ratings ----------------------------------------------------------------Moody's Investors Service extended the review of Select Medical Corporation initiated on May 17, 2004. At the time of the May 2004 review, Moody's placed the ratings of Select under review for possible downgrade following the announcement on May 11, 2004 that the Centers for Medicare & Medicaid Services had proposed reimbursement changes for long-term acute care hospitals that operate as hospitals within a hospital. On August 2, 2004, Medicare & Medicaid Services announced the final rule changes for reimbursement for long-term acute care hospitals. Moody's was in the process of evaluating the new changes on the operations and cash flow prospects of Select when the buyout was announced.

On October 18, 2004, Select announced an agreement to merge with a new company formed by an investment group led by Welsh, Carson, Anderson & Stowe and including Thoma Cressey Equity Partners and certain members of Select's management team. Under the terms of the merger agreement, each share of Select common stock, other than certain shares held by the stockholders participating in the buying group, will be converted into the right to receive $18.00 per share in cash. The transaction is valued at approximately $2.3 billion, including consideration for Select's existing indebtedness.

These ratings remain under review for possible downgrade:

* Ba3 senior implied rating

* B1 senior unsecured issuer rating

* $175 million 9.5% senior subordinated notes due 2009, rated B2

* $175 million 7.5% senior subordinated notes due 2013, rated B2

Moody's rating review will focus primarily on the anticipated effects of the reimbursement rule change for long Medicare & Medicaid Services term acute care hospitals announced by Medicare & Medicaid Services in August 2004. Further, Moody's will incorporate that analysis on a capital structure of Select that Moody's believes will contain more financial leverage following the buyout announcement.

The transaction is expected to close in the first quarter of 2005, and therefore Moody's anticipates its review will extend to that time.

Select Medical is a leading operator of specialty hospitals in the United States. Select operates 83 long-term acute care hospitals in 25 states. Select operates four acute care medical rehabilitation hospitals in New Jersey. Select is also a leading operator of outpatient rehabilitation clinics in the United States and Canada, with approximately 761 locations. Select also provides medical rehabilitation services on a contracted basis at nursing homes, hospitals, assisted living and senior care centers, schools, and worksites.

At the same time, Standard & Poor's assigned its 'B+' bank loan rating and its '3' recovery rating to Sheridan's proposed $105 million term loan due in 2010 and $40 million revolving credit facility due in 2009, indicating that lenders can expect a meaningful recovery of principal (50%-80%) in the event of default. Standard & Poor's also assigned its 'B-' rating and its '5' recovery rating to the company's proposed $65 million second lien loan, indicating that lenders can expect a negligible recovery of principal (0%-25%) in the event of default. The outlook is stable.

The Sunrise, Florida-based company has will have $170 million in debt.

As part of financial sponsor J.W. Childs' acquisition of Sheridan from Vestar Capital Partners, we expect that the proceeds from the term loan and second lien loan, in addition to approximately $162 million of equity will be used to purchase Sheridan's existing equity and debt, and cover related fees and expenses.

"After the proposed transaction, Sheridan's financial profile will be in line with the rating category, but has little cushion for potential operating difficulties," said Standard & Poor's credit analyst Jesse Juliano.

(1) Sheridan's exposure to malpractice risk, (2) the threat of increased competition, and (3) the company's high debt burden.

These concerns are partially offset by an industry trend toward physician outsourcing, the company's leading niche positions in anesthesia and neonatology staffing, and Sheridan's consistent organic growth.

SIERRA PACIFIC: Moody's Assigns Ba2 Ratings on $325M Facilities---------------------------------------------------------------Moody's Investors Service affirmed the ratings for Sierra Pacific Resources (SPR; Sr. Unsec. B2) and those of its utility subsidiaries, Nevada Power Company (NPC; Sr. Sec. Ba2) and Sierra Pacific Power Company (SPPC; Sr. Sec. Ba2). At the same time, Moody's revised the rating outlooks for the three companies to stable from negative.

(2) a recent favorable development in the court proceedings relating to Enron's claims for liquidated damages under terminated power contracts with Nevada Power and Sierra Pacific Power; and

(3) progress in filling the utilities' short supply position.

The United States District Court of the Southern District of New York recently rendered a decision to vacate the judgment previously entered by the Bankruptcy Court for the Southern District of New York against Nevada Power and Sierra Pacific Power in favor of Enron Power Marketing, Inc. for liquidated damage claims related to the terminated power supply agreements with the utilities. In remanding the case back to the Bankruptcy Court, the District Court judge called for fact finding on several issues, including but not limited to:

(1) whether Enron was reasonable in making its demands for collateral;

(2) whether the utilities' assurances were "reasonably satisfactory"; and

(3) whether Enron even had the ability to perform under the contracts when they were terminated.

Although the final outcome of this case remains in question, the parties to the case have agreed that the mostly non-cash $335 million of collateral currently held in escrow to facilitate the utilities' appeal process will remain sufficient throughout the proceedings. Given the circumstances surrounding this case, Moody's believes that it is unlikely to be resolved in the near term and therefore should not pose a funding risk over that time horizon.

Meanwhile, Moody's notes that Sierra Power Resources and its utilities have completed financings for repayment or early refinancing of obligations, thereby mitigating earlier concerns about near-term refinancing risks. Furthermore, additional revenues approved in Nevada Power's and Sierra Pacific Power's most recent general and deferred energy rate cases are providing a boost to their respective cash flows and represent signs of more supportive treatment by the Public Utility Commission of Nevada. As a result, Moody's expects funds from operations coverage of interest for the companies to move comfortably above 2 times over the next year or so.

The Public Utility Commission also recently approved Nevada Power's amended integrated resource plan and related long-term financing request. The regulatory ruling supports the utility's decision to fill some of its short supply position by purchasing the partially completed 1,200 MW natural gas combined-cycle Moapa generation plant from Duke Energy. Long-term financing authority was also granted to allow Nevada Power to pay the $182 million acquisition price and to fund the roughly $375 million of additional costs to complete the construction by the summer peak period of 2006. In yet another sign of supportive regulation by the PUCN, Nevada Power's request for the Moapa plant to be designated as a "critical facility" to meet peak demand was approved. In doing so, the Public Utility Commission provides Nevada Power with an opportunity to earn at least a 2% premium over the current 10.25% allowed return on equity for this asset. An additional 1% premium ROE will be available if Neavada Power meets certain in service target dates. As this asset is placed into Nevada Power's rate base, the supportive regulatory treatment should provide a further boost to cash flow and leave Nevada Power less dependent on more volatile wholesale market power purchases.

The Ba2 ratings assigned to the recently closed $250 million and planned $75 million revolving credit facilities for Nevada Power and Sierra Pacific Power, respectively, reflect the pari-passu status of the lenders under the utilities' respective General and Refunding Mortgage Bond Indentures. Nevada Power borrowed $150 million under the new three-year facility, which together with cash on hand was used to fund the initial purchase of the Moapa plant. The currently undrawn balance is available for general corporate purposes, including Moapa-related construction costs not otherwise covered by internally generated funds.

Moody's notes that Nevada Power may upsize the $250 million facility by $100 million to replace its more expensive $100 million synthetic credit facility, depending on market interest during the syndication process. Furthermore, Nevada Power plans to access the long-term debt markets in early 2005 to repay the drawn amounts under the revolver, thereby freeing up access to the facility for working capital needs.

In Sierra Pacific Power's case, the $75 million three-year facility will be a lower-cost replacement for the company's existing $50 million synthetic bank revolver and will be used for general corporate purposes. Sierra Pacific Power's facility will be reduced to $50 million after 364 days from closing, unless additional Public Utility Commission's long-term financing authority is obtained beforehand.

The revolving facilities for both Nevada Power and Sierra Pacific Power have similar terms and conditions, including:

Based on expected improvement in utility financial performance, Moody's expects ample headroom to be maintained against the financial covenants.

Improvement in the outlook or ratings of Sierra Power Resources, Nevada Power, and Sierra Pacific Power could result if the utilities continue to strengthen their cash flow generating capabilities as a result of continuation of more supportive treatment from the Public Utility Commission in expected future proceedings. Improvement could also stem from a victory by Nevada Power and Sierra Pacific Power in overcoming Enron's claims. Favorable developments in other lawsuits and the Federal Energy Regulatory Commission 206 complaint proceedings would also help in this regard.

Both bank agreements, which will be led by Union Bank of California, will be for three years, and will be secured by the utilities' general and refunding -- G&R -- bonds. Standard & Poor's also assigned its '1' recovery rating to the bank facilities, indicating a high expectation of full recovery of principal. The '1' rating incorporates the overcollateralization of the G&R bonds that secure the bank facilities with utility property at the utilities.

Nevada Power will use the line to acquire Duke Energy's Moapa gas plant and to fund ongoing construction before being taken out with long-term financing, and to replace a $100 million synthetic bank loan facility. Sierra Pacific Power will use the proceeds to replace its outstanding $50 million synthetic bank loan facility. These facilities, which were negotiated earlier this year, were structured facilities where funds were always drawn down and invested in money market instruments when the utilities did not need the funds. Thus, the facilities cost Nevada Power and Sierra Pacific Power 250 basis points when funds were not drawn and LIBOR plus 250 basis points for borrowings. The proposed bank lines are true revolvers and thus considerably more economic, with only a small commitment fee for undrawn funds. Sierra Pacfic Power's revolver will decrease to $50 million if the utility fails to acquire long-term debt authority from the Public Utilities Commission of Nevada for the additional $25 million within a year.

Ratings on Sierra Pacific Resources and its utility subsidiaries Nevada Power Co. and Sierra Pacific Power Co. reflect a weak consolidated business and financial profile. An uncertain but stabilizing regulatory climate in Nevada and a short generation capacity position that creates exposure to the volatile wholesale power markets are the principal sources of business risk for Sierra Pacific.

"The negative outlook reflects a financial profile that is still slightly weak for the rating and the risk posed by the exposure to wholesale power markets until [Nevada Power] can build new generation," said Standard & Poor's credit analyst Swami Venkataraman. "This exposure may result in power procurement costs significantly higher than forecast and cause liquidity and cost recovery issues."

The negative outlook also reflects the risk of a negative outcome in the Enron litigation that would require SRP to make the additional $275 million in termination payments, and the prospect of a partial or complete disallowance of these costs during a subsequent prudence review by the Public Utilities Commission. However, with much improved prospects for not having to make termination payments following the recent federal court ruling and continued collection of deferred power costs, Sierra Pacific and its subsidiaries' outlook could be revised to stable if consolidated financial ratios improve to levels consistent with the 'B+' corporate credit rating.

SPECTRASITE: Moody's Places Ba3 Rating on $900M Sr. Sec. Facility-----------------------------------------------------------------Moody's Investors Service upgraded the senior implied rating of SpectraSite, Inc. to Ba3 from B1, and the company's senior unsecured debt ratings to B2. Moody's also assigned a Ba3 rating to the proposed $900 million in senior secured credit facilities of SpectraSite Communications, Inc. among other ratings actions. The outlook for all these ratings is positive.

SpectraSite, Inc.

* Senior implied rating upgraded to Ba3 from B1

* Issuer rating upgraded to B2 from B3

* $200 million 8.25% Senior Notes due 2010 upgraded to B2 from B3

SpectraSite Communications, Inc.

* $200 million senior secured revolving credit assigned Ba3

* $300 million senior secured delayed draw term loan assigned Ba3

* $400 million senior secured term loan assigned Ba3

* Existing credit facilities due 2007 ratings withdrawn

The upgrade of the senior implied rating to Ba3 reflects the strong and consistent cash flow growth, both historical and projected, of the company as well as the expiration last August of a significant tower purchase commitment that went substantially unutilized. The Ba3 senior implied rating reflects the strong financial profile of the company, with substantial free cash flows and very good liquidity, combined with the low business risk of the communications tower leasing business model. The rating also reflects Moody's expectation that management's stated intention to keep the ratio of total debt to EBITDA between 4 to 5 times (up from approximately 3.5 times currently) will hold over the ratings horizon (two to three years).

The Ba3 rating on the $900 million of new senior secured credit facilities of SpectraSite Communications, Inc. (a subsidiary of the ultimate parent, SpectraSite, Inc.) reflect the preponderance of these obligations in the company's capital structure. While only half of that total amount is expected to be drawn at closing, this will represent close to 70% of balance sheet debt. Further, Moody's expects SpectraSite to utilize a portion of the undrawn availability to refinance the holding company notes, to repurchase stock or pay dividends, or to make additional investments in the business.

The B2 rating on the 8.25% Senior Notes due 2010 issued by SpectraSite, Inc. reflect their structural subordination to outstandings under the above mentioned secured credit facility as well as other liabilities of the companies subsidiaries.

In 2003, SpectraSite generated $102.9 million in cash provided by operations and spent $24.5 million on capital expenditures and another $28.5 million to acquire additional towers. In 2004, SpectraSite should generate over $140 million in cash from operations and spend approximately $50 million of capital expenditures and another $53.6 million to complete the SBC tower purchase commitment. Going forward, cash from operations will increase as revenue grows and interest expense declines due to the current refinancing. While capital expenditures are likely to increase from current levels, Moody's assumes SpectraSite will engage in no large scale acquisition spending. Thus Moody's expects free cash flow (defined as cash from operations less capital expenditures) to exceed $100 million in 2005, or 15% of the $650 million of balance sheet debt.

Moody's ratings outlook is positive. SpectraSite is likely to seek to return value to its shareholders, and the new credit facility provides ample flexibility to do so. The ratings pressure would likely result should SpectraSite institute a dividend policy that would reduce the ratio of free cash flow to debt below 10%, increase leverage through large acquisitions, or should revenue growth subside. The ratings could be improved should SpectraSite devote a large portion of its free cash flow to permanent debt repayment.

Based in Cary, North Carolina, SpectraSite, Inc. is an independent owner and operator of approximately 7,800 wireless communications towers in the US with LTM revenues of $333 million.

STAPP TOWING CO: List of Debtor's 20 Largest Unsecured Creditors----------------------------------------------------------------Stapp Towing Co., Inc. released a list of its 20 Largest Unsecured Creditors:

Headquartered in Dickinson, Texas, Stapp Towing Co., Inc. provides tugboat and towing services. The Company filed for chapter 11 protection (Bankr. S.D. Tex. Case No. 04-82115) on October 11, 2004. Thomas Baker Greene, III, Esq., at Kajander & Greene, represents the Company in its restructuring efforts. When the Debtor filed for protection from its creditors, it estimated both assets and debts of more than $1 Million.

TECNET INC: Trustee Hires Steve Donosky as Real Estate Broker-------------------------------------------------------------The U.S. Bankruptcy Court for the Northern District of Texas, Dallas Division, gave Scott M. Seidel, the Chapter 7 Trustee in Tecnet, Inc.'s bankruptcy proceeding, permission to employ Steve Donosky and Steve Donosky Company as his real estate agent and broker.

The Trustee tells the Court that he employed Steve Donosky Company to specifically assist him in marketing and securing a fair purchase price for Tecnet, Inc.'s property located at 10050 Shoreview Road, Dallas, Texas 75238.

The Trustee adds that Steve Donosky Company is qualified to act as real estate broker because of its familiarity with Tecnet, Inc.'s property and the real estate market in the area.

The Trustee explains that Steve Donosky Company will be paid a commission of six percent for a completed sale of Tecnet, Inc.'s property and is authorized to share this commission with outside real estate brokers that may assist with the sale of the property.

Steve Donosky Company does not represent any interest adverse to the Trustee, the Debtor or its estate.

Headquartered in Garland, Texas, TecNet, Inc., provides telecommunication services, filed for chapter 11 protection on April 8, 2004 (Bankr. N.D. Tex. Case No. 04-34162) and its case was converted to a chapter 7 liquidation proceeding on June 4, 2004. Scott M. Siedel serves as the chapter 7 Trustee. Mark A. Weisbart, Esq., represents the Debtor in its restructuring efforts. When the Company filed for protection from its creditors, it listed estimated debts of over $10 million and estimated debts of over $100 million.

THAXTON GROUP: Southern Management Wants to Obtain $30MM DIP Loan----------------------------------------------------------------- Thaxton Group, Inc., intends to structure a chapter 11 plan under which Southern Management Corp. emerges as an intact and viable business. Southern Management needs financing between now and its emergence from chapter 11 and will need access to working capital thereafter. Bank of America offered to lend Southern Management $30 million under the terms of a DIP Facility that will roll into a $45 million Exit Facility. Thaxton asks the U.S. Bankruptcy Court for the District of Delaware for authority to enter into the loan agreement, pay BofA a $225,000 DIP Loan Commitment Fee now, and pay a $112,500 Exit Loan Commitment Fee when the exit financing facility springs to life.

Headquartered in Lancaster, South Carolina, The Thaxton Group, Inc., is a diversified consumer financial services company. The Company filed for Chapter 11 protection on October 17, 2003 (Bankr. Del. Case No. 03-13183). The Debtors are represented by Michael G. Busenkell, Esq., and Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell.

TOM'S FOODS: S&P Slices Corporate Credit Rating to CCC from B-------------------------------------------------------------Standard & Poor's Ratings Services lowered its ratings on privately owned regional snack food manufacturer and distributor Tom's Foods Inc., including its corporate credit rating to 'CCC' from 'B'. At the same time, the ratings were removed from CreditWatch, where they were placed Aug. 20, 2004. The outlook is negative.

Standard & Poor's estimates that the Columbus, Georgia-based company had about $66.4 million of total debt outstanding at September 11, 2004.

The downgrade reflects Standard & Poor's concerns about Tom's Foods' ability to refinance, in a timely manner, its $17 million revolving credit facility due Oct. 22, 2004, and its $60 million 10.5% senior secured notes due Nov. 1, 2004.

The prior termination date for the revolving credit facility was August 31, 2004, and the company extended this to Sept. 30, 2004, while it worked on a transaction to refinance both the credit facility and notes. The company obtained a subsequent extension through October 22, 2004.

"We will continue to monitor Tom's Foods liquidity position and its ability to meet these obligations when they become due," said Standard & Poor's credit analyst Alison Birch.

* $20 million senior secured revolving credit facility due March 15, 2009 to B2 from B1;

* $110 million senior secured term loan b due March 15, 2011 to B2 from B1;

* $125 million 8 3/8% senior subordinated notes due March 15, 2011 to Caa1 from B3;

* Senior unsecured rating to B3 from B2.

The ratings downgrade reflects ongoing pressure on profits and cash flows, which is not allowing for credit measures or debt reduction at the pace consistent with higher rating levels. Severe second quarter declines in golf shaft sales (approximately 94% of its total revenues) negatively impacted profitability, resulting in an increase in LTM debt-to-EBITDA to approximately 7x, versus Moody's expectation for rapid deleveraging from pro forma levels of 6.7x at the time of its recapitalization earlier this year. Management attributes the sales declines to overall softness in the golf industry and delays of new product introductions by the golf equipment manufacturers. Further, the performance sports segment, True Temper's prospective source of diversification away from the golf market, also performed poorly in the second quarter. Moody's remains concerned that profits will remain under pressure during the remainder of the year and into 2005, particularly as the company looks to manage down increased inventory levels and faces uncertain discretionary consumer spending and potential volatility in raw material prices. Importantly, Moody's now expects free cash flow as a percentage of funded debt in the mid-to-high single digit range, versus earlier expectations for double-digits levels that would correspond with rapid deleveraging.

Notwithstanding these concerns, the stable ratings outlook reflects Moody's expectation that True Temper's positive cash flow profile, supportive bank actions, and ongoing rating strengths comfortably position the new rating levels over the coming quarters. The company's healthy margins, modest capital spending requirements, low borrowing costs, and lack of significant cash tax obligations, are likely to provide debt reduction capacity consistent with the revised rating levels. However, financial covenants have been reset to achievable levels to provide continued access to borrowing lines (revolver remains undrawn). The stable outlook is further supported by True Temper's long-standing dominant market position and innovation capability in the steel golf shaft market, and by management's proven track record of disciplined cost controls, working capital management, and debt reduction during difficult operating periods.

Moody's revised ratings allow for modest continued deterioration over the next few quarters, but more severe and protracted deterioration would likely result in negative rating actions. Moody's expects True Temper to remain cash flow positive near or above the 5 to 7% range relative to funded debt in order to remain at its current rating with a stable outlook. Over the next 12 months, Moody's anticipates limited upward rating pressure.

True Temper Sports, Inc., a wholly owned subsidiary of True Temper Corporation with corporate headquarters in Memphis, Tennessee, is the leading manufacturer of steel golf club shafts. The company supplies steel shafts to all major club designers and distributors, with an estimated worldwide share of 68% according to management's estimates. The company also participates in the premium-end of the graphite golf shaft market and manufactures tubular components for other recreational sports including hockey, lacrosse and bicycling. Net sales for the twelve-month period ended June 27, 2004 were approximately $108 million.

TRUMP HOTELS: Cuts New Deal to Underpin Chapter 11 Prepack in Nov.------------------------------------------------------------------Trump Hotels & Casino Resorts, Inc. (OTCBB: DJTC.OB), Donald J. Trump, and holders of approximately 57% of Trump Atlantic City Associates' First Mortgage Notes due 2006, approximately 68% of Trump Casino Holdings, LLC's First Priority Mortgage Notes due 2010 and approximately 81% of Trump Casino Holdings, LLC's Second Priority Notes due 2010 entered into a Support Agreement in connection with the recapitalization of the Company pursuant to a plan of reorganization. As part of the Plan, Donald J. Trump, who will remain the Company's Chairman and Chief Executive Officer, will invest approximately $71.4 million into the recapitalized Company. Mr. Trump's investment will consist of a $55 million cash equity investment and the conversion of approximately $16.4 million principal amount of TCH Second Priority Notes owned byhim into shares of the recapitalized Company's common stock. Uponconsummation of the Plan, Mr. Trump is expected to remain the largest individual stockholder of the Company, with beneficial ownership of approximately 27% of the Company's common stock.

The Plan calls for an approximately $400 million reduction in theCompany's indebtedness with a reduced interest rate of 8.5%,representing annual interest expense savings of approximately $98million. The Plan also permits a working capital facility of up to$500 million secured by a first priority lien on substantially all of the Company's assets (the "Working Capital Facility"), which isexpected to allow the Company to refurbish and expand its currentproperties and permit the Company to enter into new and emergingjurisdictions, among other uses.

Donald J. Trump, the Company's Chief Executive Officer andChairman, commented on the Plan, "I have never been more excited about the prospects for our Company. We now have the capacity tosignificantly expand the Trump brand into the ever-evolving gamingindustry. I anticipate THCR achieving the same level of success as my other business and real estate endeavors." Scott C. Butera, theCompany's Executive Vice President of Corporate and StrategicDevelopment, added, "We are very pleased that we have come to amutually beneficial agreement with our bondholders which successfully achieves our financial and strategic objectives and provides significant value to our stakeholders. In addition, we have developed strong working relationships with many institutional investors who we hope will continue to support the growth of our operations and brand. We are now positioned to capitalize on the numerous opportunities present in today's gaming and entertainment industry." Mr. Butera continued, "The proposed capital structure streamlines our organization and is expected to provide for increased operational efficiencies and financial flexibility. It will also make our Company easier to understand to the public and investment community."

Under the Plan, the holders of the TAC Notes and the unaffiliatedholders of the TCH Notes would exchange their notes (approximately$1.8 billion aggregate principal amount) for an aggregate ofapproximately $74 million in cash, an aggregate of $1.25 billionprincipal amount of a new series of 8.5% senior second prioritymortgage notes with a ten-year maturity and secured by a lien onsubstantially all of the Company's assets, subject to the WorkingCapital Facility (the "New Notes"), and approximately $395 million of common stock of the Company valued at the same per share purchase price as Mr. Trump's investment (assuming the unaffiliated stockholders of the Company fully exercise the warrants discussed below).

Existing unaffiliated stockholders of the Company would retaintheir interests in their current common stock (which would be diluted to 0.05% of the total equity interests of the recapitalized Company and are expected to be reclassified pursuant to a reverse stock split upon consummation of the Plan). The existing unaffiliated stockholders would also receive one-year warrants upon consummation of the Plan to purchase common stock at the same per share purchase price as Mr. Trump's investment. Proceeds from the exercise of the warrants (as well as any remaining shares of the $50 million of the Company's common stock reserved for warrant exercises, if not all of the warrants are exercised) would be distributed to the holders of the TACNotes. If all of the warrants are exercised, the Company'sunaffiliated stockholders would hold approximately 8.3% of theCompany's common stock, the holders of TAC Notes would holdapproximately 63.7% of the Company's common stock and the holders of the TCH First Priority Notes would hold approximately 1.4% of the Company's common stock, each on a fully-diluted basis.

Houlihan Lokey Howard & Zukin has been serving as the financialadvisor to the TAC Noteholders involved in the discussions.

David R. Hilty, Managing Director in the Financial Restructuring Group of Houlihan Lokey Howard & Zukin, commented, "This recapitalization puts the Company in a strong financial position with immediate access to significant capital. The TAC Noteholders are enthusiastic to be teaming up with Mr. Trump and to capitalize on the many opportunities generated by the Trump brand."

Chanin Capital Partners has been serving as the financial advisorto the TCH Noteholders involved in the discussions. "We are pleased that the Company has reached a consensual recapitalization with such a large percentage of its stakeholders. The transaction will position THCR for future growth and expansion," stated Russell A. Belinsky, Senior Managing Director of Chanin Capital Partners.

Upon consummation of the Plan, the Company is expected to transferto Mr. Trump the former Trump's World's Fair site in Atlantic City, New Jersey and the Company's 25% interest in the Miss Universe pageant. The Company would also enter into a development agreement with the Trump Organization, pursuant to which the Trump Organization would have a right of first offer to serve as project manager, construction manager and/or general contractor with respect to construction and development projects for casinos and casino hotels and related lodging at the Company's existing and future properties. Mr. Trump has also agreed to grant the Company and its subsidiaries a new trademark license agreement for use of his name and likeness as well as enter into a services agreement with the Company.

The Support Agreement contemplates that the Company would commencereorganization proceedings by late November 2004 and that the Planwould be confirmed by mid-April 2005 and consummated by May 1, 2005. The Company intends to arrange for up to $100 million interim financing during the proceedings.

Gregg H. Feinstein, Director of Mergers & Acquisitions atJefferies & Company, who advised the Special Committee of independent Directors of the Company's Board of Directors, noted, "This transaction is the culmination of a significant effort on the part of many constituencies. The public stockholders will have a compelling opportunity to share in the value which the Company believes will be generated going forward."

The implementation of the Plan is subject to a number ofconditions typical in similar transactions including, among otherthings, the negotiation of the investment agreement and otherdocumentation relating to the Company's arrangements with Donald J. Trump, the Plan and accompanying disclosure statement, the indenture governing the New Notes and other transaction documents. The Plan would also be subject to applicable government approvals, including court approval of the Plan and related solicitation materials, gaming authority approvals and other relevant filings. The definitive terms and conditions of the Plan would be outlined in a disclosure statement that would be sent to security holders entitled to vote on the Plan after confirmation by the court.

UBS Investment Bank has been serving as the Company's financialadvisor in connection with the Plan. Tom Benninger, Global Head ofUBS' Restructuring Group, commented, "This transaction was designed to provide many substantial benefits for the Company and its constituents. We are pleased to have been involved in the development of such a promising plan."

The recapitalized Company intends to apply to have its new commonstock listed on the New York Stock Exchange or other nationalsecurities exchange upon the consummation of the Plan.

About the Company

Through its subsidiaries, THCR owns and operates four propertiesand manages one property under the Trump brand name. THCR's ownedassets include Trump Taj Mahal Casino Resort and Trump Plaza Hotel and Casino, located on the Boardwalk in Atlantic City, New Jersey, Trump Marina Hotel Casino, located in Atlantic City's Marina District, and the Trump Casino Hotel, a riverboat casino located in Gary, Indiana. In addition, the Company manages Trump 29 Casino, a Native American owned facility located near Palms Springs, California. Together, the properties comprise approximately 451,280 square feet of gaming space and 3,180 hotel rooms and suites. The Company is the sole vehicle through which Donald J. Trump conducts gaming activities and strives to provide customers with outstanding casino resort and entertainmentexperiences consistent with the Donald J. Trump standard ofexcellence. THCR is separate and distinct from Mr. Trump's real estate and other holdings.

Revenue from higher volumes and improved product mix accounted for most of the increase, with favorable currency translation and acquisitions also contributing. Grace reported third quarter net income of $48.0 million, compared with a loss of $9.9 million, in the third quarter of 2003. The 2004 third quarter includes:

-- a noncore pre-tax charge of $20.0 million to account for an increase in Grace's estimated liability for vermiculite- related environmental costs, and

-- a noncore pre-tax net gain of $50.0 million from the settlement of litigation relating to the contamination of a non-operating parcel of land.

Pre-tax income from core operations in the third quarter of 2004 was $57.7 million compared with $50.3 million in the third quarter of 2003, a 14.7% increase. The incremental margin from added sales together with successful productivity initiatives offset higher costs of petroleum-based raw materials, transportation fuels and energy. "Our businesses continued to deliver solid growth and productivity," said Grace's Chairman and Chief Executive Officer Paul J. Norris. "Sales and operating income from our Davison businesses were particularly strong, reflecting increased demand for our higher performing products in Europe and North America and lower operating costs from more efficient manufacturing processes. However, the high cost of commodity-based raw materials and energy are likely to continue to dampen near-term profitability."

For the first nine months of 2004, Grace reported sales of $1,670.8 million, a 13.7% increase over 2003. Favorable currency translation and acquisitions accounted for 6.1 percentage points of the increase. Net income through September 2004 was $85.1 million, compared with a net loss of $5.7 million, for the comparable 2003 period. The year-to-date improvement in net income is primarily attributable to higher pre-tax income from core operations, which was $145.5 million in 2004 compared with $97.4 million in 2003, a 49.4% increase, and from the net gain on the settlement of property litigation described above. Operating margins were 8.7% versus 6.6% last year. The increase in operating profit and margins was principally attributable to strong sales growth, cost structure improvements from productivity initiatives and favorable foreign currency translation.

At September 30, 2004, W.R. Grace's balance sheet showed a $117.7 million, compared to a $163.8 million deficit at December 31, 2003.

Core Operations

Davison Chemicals Refining Technologies and Specialty Materials

Third quarter sales for the Davison Chemicals segment were $303.8 million, up 13.8% from the prior year quarter, mainly reflecting volume increases from growth programs, improved economic conditions, and acquisitions. Excluding the effects of favorable currency translation, sales were up 11.0% for the quarter. Sales of refining technologies products, which include fluid cracking catalysts, hydroprocessing catalysts and performance additives, were $169.1 million in the third quarter, up 9.4% compared with the prior year quarter (7.8% after accounting for favorable currency translation). Most of the increase resulted from favorable product mix factors, including sales of higher performing catalysts, and added revenue from the pass-through of certain raw material cost increases.

Sales of specialty materials products, which include silica-based engineered materials, specialty catalysts and separations products, were $134.7 million, up 19.7% compared with the third quarter of 2003, reflecting strong volume from specialty catalysts and engineered materials in all key regions. Sales from the acquisition of Alltech International (completed August 2, 2004) and favorable currency translation, primarily from the stronger Euro, contributed about 11.3 percentage points of the increase. Operating income of the Davison Chemicals segment for the third quarter was $42.6 million, 31.1% higher than the 2003 third quarter. Operating margin was 14.0%, higher than the prior year quarter by 1.8 percentage points. The increase in operating income was driven primarily by improved sales in North America and in Europe, as well as favorable foreign currency effects. Third quarter operating margin was enhanced by increased sales of a higher margin product mix and lower manufacturing costs, offsetting increases in the cost of raw materials and energy.

Year-to-date sales for the Davison Chemicals segment were $872.5 million, up 13.7% from 2003 (excluding currency translation impacts, sales were up 9.6%). Year-to-date operating income was $112.1 million, compared with $80.1 million for the prior year, a 40.0% increase. Year-to-date operating results reflect similar economic conditions, product mix factors and cost improvements to those experienced in the third quarter.

Performance Chemicals

Construction Chemicals, Building Materials Sealants and Coatings

Third quarter sales for the Performance Chemicals segment were $276.1 million, up 8.7% from the prior year quarter. Favorable currency translation accounted for 2.7 percentage points of the increase. Sales of specialty construction chemicals, which include concrete admixtures, cement additives and masonry products, were $139.7 million, up 16.3% versus the year-ago quarter (13.6% excluding favorable currency translation impacts). Revenues from an October 1, 2003 acquisition in Germany accounted for about one-third of the increase. Sales were up in all geographic regions, mainly reflecting the continued success of growth initiatives. Sales of specialty building materials, which include waterproofing and fire protection products, were $65.6 million, up 0.9% compared with a very strong third quarter of 2003 (down 1.4% excluding favorable currency translation impacts). The third quarter results reflect increased sales of waterproofing materials, particularly specialty below-grade waterproofing and tapes for window and door flashing. Sales of fire protection products were down year-over-year mainly due to hurricane-related project delays. Sales of specialty sealants and coatings, which include container sealants, coatings and polymers, were $70.8 million, up 2.8% compared with the third quarter of 2003 (about even with the prior year excluding favorable currency translation impacts). Operating income for the Performance Chemicals segment was $39.5 million, a record quarter and up 2.3% compared with a strong prior year, driven primarily by sales growth. Operating margin of 14.3% was 0.9 percentage points lower than the 2003 third quarter margin, attributable to higher raw material and transportation costs, partially offset by productivity gains.

Year-to-date sales of the Performance Chemicals segment were $798.3 million, up 13.8% from 2003 (excluding currency translation impacts, sales were up 9.6%). Year-to-date operating income was $106.0 million compared with $76.5 million for the prior year, a 38.6% increase, reflecting strong sales in all regions, including sales from the German acquisition, and positive results from productivity and cost containment initiatives.

Corporate Costs and Other Matters

Third quarter corporate costs related to core operations were $24.4 million compared with $20.8 million in the prior year quarter; year-to-date corporate costs were $72.6 million compared with $59.2 million last year. The third quarter and year-to-date increases are primarily attributable to performance-related compensation.

These special items are reflected in the third quarter:

1) Grace recorded a net gain of $50.0 million from the settlement of litigation under an agreement with Honeywell International Inc. related to environmental contamination of a non-operating parcel of land.

2) Grace recorded a $20.0 million increase in its estimated liability for vermiculite-related environmental costs to reflect Grace's current understanding of the timeframe and related costs necessary to remediate properties in and around Libby, Montana.

Cash Flow and Liquidity

Grace's year-to-date cash flow provided by operating activities was $167.4 million for 2004, compared with $63.9 million for the comparable period of 2003. Year-to-date pre-tax income from core operations before depreciation and amortization in 2004 was $225.9 million, 30.2% higher than 2003. These results reflect the higher income from core operations described. Cash used for investing activities was $92.6 million through September 2004, primarily for capital replacements and business acquisitions. In addition, Grace contributed $19.8 million to its qualified U.S. pension plans as permitted by a Bankruptcy Court order issued in August.

At September 30, 2004, Grace had available liquidity in the form of cash ($385.1 million), net cash value of life insurance ($97.1 million) and unused credit under its debtor-in-possession facility ($213.5 million). Grace believes that these sources and amounts of liquidity are sufficient to support its strategic initiatives and Chapter 11 proceedings for the foreseeable future.

W.R. GRACE: Wants to Restrict Equity Trading to Preserve NOLs-------------------------------------------------------------To preserve the future tax benefits related to its significant U.S. federal net operating losses, W. R. Grace & Co. (NYSE:GRA) asked the U.S. Bankruptcy Court for the District of Delaware impose notice requirements and potential restrictions on stock acquisitions by those persons or entities that:

(i) currently own 4.75% or more of Grace common stock or

(ii) seek to acquire 4.75% or more of Grace common stock.

Pursuant to the Order, Grace would have the right to object in Bankruptcy Court to such persons or entities acquiring Grace common stock if such acquisition would pose a material risk of adversely affecting Grace's ability to utilize its NOLs. Under U.S. tax rules, NOLs are subject to potentially severe limitations in the event of ownership changes triggering a change in control (as defined under the Internal Revenue Code). The Order would remain in effect until Grace emerges from Chapter 11.

On April 2, 2001, Grace and 61 of its United States subsidiaries and affiliates, including its primary U.S. operating subsidiary W. R. Grace & Co.-Connecticut, filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware. Grace's non-U.S. subsidiaries and certain of its U.S. subsidiaries were not part of the Filing. Since the Filing, all motions necessary to conduct normal business activities have been approved by the Bankruptcy Court.

On October 15, 2004, Grace filed a motion with the U.S. Bankruptcy Court in Delaware to delay filing its proposed plan of reorganization until November 16, 2004. The Plan was due to be filed on October 14, 2004. In a meeting held on October 14, 2004, among Grace and the official representatives of the asbestos creditors and the future asbestos claimants, sufficient progress was made for the parties to conclude that additional negotiations could lead to a consensual Chapter 11 plan. The asbestos committees and the future asbestos claimants' representative support this motion, which Grace has requested be considered at its scheduled omnibus hearing on October 25, 2004. Grace expects to continue discussions with the official committees representing asbestos claimants, general unsecured creditors, and equity holders and with the future asbestos claimants' representative over the next several weeks. If negotiations do not lead to the filing of a consensual plan, Grace is prepared to file its own plan of reorganization, which would provide for the Bankruptcy Court to determine Grace's asbestos-related liability based on estimation protocols.

Whether Grace proposes its own plan of reorganization or a consensual plan with the support of creditors and equity holders, Grace is likely to make use of Section 524(g) of the Bankruptcy Code to resolve its asbestos-related liabilities. Section 524(g) requires, among other things, that a trust be established through which all current and future claims would be channeled for resolution, and that at least a majority of the voting securities of the reorganized Grace be owned by, or contingently available to, the trust to resolve such claims.

As stated in Grace's second quarter Form 10-Q, Grace is reevaluating its asbestos-related liability in light of the requirement to propose a plan of reorganization as discussed. The measure of such liability, and the ultimate net cost to Grace, depends on a number of factors that require Bankruptcy Court approval such as:

-- the definition of an allowed claim;

-- the actual or estimated claims that meet such definition;

-- the value of allowed claims based on severity of medical condition;

-- the risk of property damage related to Zonolite(R) Attic Insulation, if any;

-- the number of properties qualifying for asbestos abatement and the cost of remediation;

-- the method of funding an asbestos trust;

-- the availability of funds under litigation settlement agreements with Sealed Air Corporation and Fresenius Medical Care; and,

-- the availability of insurance and timing of insurance recovery.

Grace will address these matters as part of a proposed plan of reorganization. The liability for asbestos-related litigation reflected in this release has not been adjusted for these uncertainties.

Most of Grace's noncore liabilities and contingencies (including asbestos-related litigation, environmental claims, tax matters and other obligations) are subject to compromise under the Chapter 11 process. The Chapter 11 proceedings, including related litigation and the claims valuation process, could result in allowable claims that differ materially from recorded amounts. Grace will adjust its estimates of allowable claims as facts come to light during the Chapter 11 process that justify a change, and as Chapter 11 proceedings establish court-accepted measures of Grace's noncore liabilities. See Grace's recent Securities and Exchange Commission filings for discussion of noncore liabilities and contingencies.

WOMEN FIRST: Wants Until December 27 to Decide on Leases--------------------------------------------------------Women First Healthcare, Inc., asks the U.S. Bankruptcy Court for the District of Delaware to extend until December 27, 2004, their time to decide whether to assume, assume and assign, or reject the unexpired lease of its headquarters' real property located in San Diego, California.

The Debtor needs an operating facility to conduct its business with respect to its remaining assets in order to maintain asset value during the marketing and sale process.

The Debtor tells the Court that if the current deadline is not extended, it may be compelled prematurely to assume liabilities under the unexpired lease or forfeit benefits associated with the unexpired leases.

Headquartered in San Diego, California, Women First HealthCare,Inc. -- http://www.womenfirst.com/-- is a specialty pharmaceutical company dedicated to improve the health and well-being of midlife women. The Company filed for chapter 11 protection on April 29, 2004 (Bankr. Del. Case No. 04-11278).Robert A. Klyman, Esq., at Latham & Watkins LLP, and Michael R.Nestor, Esq., and Sean Matthew Beach, Esq., at Young ConawayStargatt & Taylor represent the Debtor in its restructuring efforts. Kirt F. Gwynne, Esq., at Reed Smith LLP, represents the Official Committee of Unsecured Creditors. When the Company filed for protection from its creditors, it listed $49,089,000 in total assets and $73,590,000 in total debts.

The Yale, Mich.-based provider of specialty services to the foundry industry has determined that it no longer can continue in business for four reasons:

* The Company continues to lose money because of insufficient customer based sales. The American Auto Industry continues to outsource foundry and related products to offshore countries located in South America, Europe, and Asia.

* The Company does not have the resources or credit capabilities to convert its current operation, Yale Industries Inc., into another business.

* The Company is being sued by the trustee attorneys for the bankruptcy of New Haven Foundry, Inc., which is claiming the Company received preferential payments in excess $1,000,000. Yale believes New Haven received these payments in the ordinary course of business for the services performed on castings and shipped to Chrysler Corporation. Yale will defend the lawsuit on that basis. New Haven Foundry, Inc., filed for bankruptcy on Nov. 27, 2001 (Bankr. E.D. Mich. Case No. 01-62954) and is liquidating under chapter 7.

* Two more major foundry groups filed for bankruptcy in September 2004. One of these [Berlin Foundry Corp. (Bankr. N.D. Ala. Case No. 04-08145, jointly administered with Citation Corporation, Bankr. Case No. 04-08130] is a major customer of the Company.

With this trend continuing and the increased cost due to defending a lawsuit the Company has reached a point where it must liquidate in order to pay off its creditors and legal fees. The Company is notifying its remaining customers that they will be given until December 15, 2004 to find another source to process their products.

The Company will immediately begin selling its assets to pay off the bank and its creditors.

The Company will attempt to find an existing non-public entity that would be interested in going public and offer the Margate shareholders stock in exchange for their stock.

Type of Business: The Company is a marketing specialist in customer value creation, online or traditional. The Company is also an industry leader and innovator in the analysis and redesign of business practices, products and services, persuasion channels, marketing processes, measurement and valuation systems, e-commerce, and e-persuasion systems. See http://www.zoetics.com/

* Alvarez & Marsal Honored for Successful Restructuring of AMERCO-----------------------------------------------------------------The Arizona chapter of the Turnaround Management Association has honored Alvarez & Marsal, a leading global professional services firm, with the prestigious "Turnaround of the Year" award in recognition of the firm's successful restructuring of AMERCO, the parent company of U-Haul International, Inc., which emerged from bankruptcy in March of 2004.

Spearheaded by A&M Managing Director Richard Williamson, the engagement involved a team of talented professionals including Shawn Hassel, Marc Liebman, and Josh Skevington.

"When AMERCO exited bankruptcy, it secured a rare place in history, emerging from Chapter 11 with a global capital structure that resulted in zero dilution in shareholder value," said Mr. Williamson. "By the end of the swift restructuring process, AMERCO's common equity value increased by over 350%, or over $350 million in market capitalization, and nearly $300 million in value was restored to the investments of preferred stock and unsecured debt holders. The success of this complex restructuring exceeded even our own high expectations and we are honored to be recognized by the Arizona chapter of the TMA for our efforts."

A&M was retained as AMERCO's exclusive financial advisors in May of 2003 on the eve of a threatened involuntary bankruptcy filing by bondholders. Less than one year later, through A&M's efforts, AMERCO executed one of the most successful capital structure restructurings on record - developing a complex, consensual restructuring plan that involved 100% payout to existing creditors (in cash and securities) and zero dilution to preferred and common stock holders.

A&M's success was rooted in a bottoms up financial analysis that helped to unravel the company's confusing financial statements. The analysis also enabled the team to identify AMERCO's hidden value and cash flow generating capabilities, which provided the basis for the restructuring plan. The comprehensive plan was presented to, negotiated with and approved by a diverse group of debt and equity holders, comprised of many of the largest and most sophisticated financial institutions in the U.S.

The Turnaround Management Association is a premier professional community dedicated to corporate renewal and turnaround management.

About Alvarez & Marsal

Founded in 1983, Alvarez & Marsal is a global professional services firm that helps businesses and organizations in the corporate and public sectors navigate complex business and operational challenges. With professionals based in locations across the U.S., Europe, Asia, and Latin America, Alvarez & Marsal delivers a proven blend of leadership, problem solving and value creation. Drawing on its strong operational heritage and hands-on approach, Alvarez & Marsal works closely with organizations and their stakeholders to mobilize and address business issues, implement change and favorably influence results. Its service offerings include Turnaround Management Consulting, Crisis and Interim Management, Creditor Advisory, Financial Advisory, Dispute Analysis and Forensics, Real Estate Advisory, Business Consulting and Tax Advisory. For more information about the firm, visit http://www.alvarezandmarsal.com/

* FTI Consulting Hires 3 New Senior Managing Directors------------------------------------------------------FTI Consulting, Inc. (NYSE: FCN), the premier provider of corporate finance/restructuring, forensic and litigation consulting, and economic consulting, announced three senior level new hires. Michael Eisenband, Steven D. Simms and Samuel E. Star have joined the company as senior managing directors in the Corporate Finance/Restructuring practice working within its national Creditor Rights team.

Michael Eisenband will be responsible for working with FTI's Corporate Finance/Restructuring leaders and client base to continue to build a national market-leading Creditor Rights offering. He joins FTI Consulting's New York office with more than 16 years experience in restructuring work for creditors and companies in Chapter 11 bankruptcies and out-of-court workouts with a particular focus on creditors' rights.

Mr. Eisenband, renown nationally as an industry leader in providing restructuring services to creditor committees, was previously a managing director at Ernst & Young Corporate Finance LLC and national director of its Creditor Rights practice. Some of Mr.Eisenband's notable engagements have included Service Merchandise, Phar-mor, Impath Clinical Labs and Penn Traffic.

Mr. Eisenband holds a BS in Accounting from the State University of New York in Buffalo. He is a member of the American Institute of Certified Public Accountants and the New York State Society of Certified Public Accountants, where he is a former member of the Insolvency Committee. He holds NASD Series 7, 24 and 63 licenses. He is a Board Member of the New York Chapter of Turnaround Management Association and a member of the Governing Board to the Commercial Finance Association.

With over 15 years of corporate finance and restructuring experience, Steven D. Simms also joins FTI's Creditor Rights team working out of New York. Prior to joining FTI Consulting, he was a managing director at Ernst & Young Corporate Finance LLC. With a broad array of experience, Mr. Simms has advised creditor groups, companies and lenders on all aspects of corporate restructurings, mergers, acquisitions, valuation, strategic business planning, and debt and equity financings.

Mr. Simms served as a financial advisor in transactions across many industries including food and beverage wholesaling and retailing, restaurant, textile and apparel, and general manufacturing. Some of Mr. Simms notable engagements have included Chi Chi's, Eagle Food Centers, World Kitchen, Pillowtex Corporation and Avado Brands. Prior to joining Ernst & Young, Mr. Simms spent seven years as a loan officer at The Bank of New York, providing acquisition, growth and working capital financing to companies in various industries.

Mr. Simms holds a BS in Consumer Economics from Cornell University and an MBA in Finance from New York University's Stern School of Business. He holds NASD Series 7, 24 and 63 licenses.

Samuel E. Star joins FTI's national Creditor Rights team working out of New York. Prior to joining FTI Consulting, he also served as a managing director at Ernst & Young LLC specializing in providing services to creditors in Chapter 11 and out-of-court workout situations. He is a leader in advising all types of creditor constituencies in both large and small cases.

With over 17 years in the restructuring business, Mr. Star has worked on client engagements spanning multiple industries including airlines, healthcare, metals, retail and consumer products, telecommunications and textiles. Significant cases have included Adelphia Business Solutions, American Pad and Paper, Agway and Cone Mills. His responsibilities have included review of business plans, assessment of asset disposition programs, evaluation and negotiation of restructuring proposals and the development of exit strategies; all focused on maximizing recoveries for unsecured creditors.

Mr. Star holds a BS in Accounting from the State University of New York in Albany and NASD Series 7, 24 and 63 licenses. He is a certified public accountant and member of the American Bankruptcy Institute and has been a frequent speaker for various organizations on matters impacting the rights of unsecured creditors.

Commenting on the new appointments, Jack Dunn, FTI's president and chief executive officer and said, "We continue to expand our intellectual capital through the hiring of these three highly skilled professionals that, along with our existing professionals, serve to distinguish FTI from its peers."

"Mike's extensive experience in creditor's rights matters qualifies him as the ideal choice to lead FTI's Creditor Rights offering. We are gratified that Steve and Sam have agreed to help us in that effort given their equally outstanding experience," Mr. Dunn continued.

About FTI Consulting

FTI is the premier provider of corporate finance/restructuring, forensic and litigation consulting, and economic consulting. Strategically located in 24 of the major US cities and London, FTI's total workforce of approximately 1,000 employees includes numerous PhDs, MBA's, CPAs, CIRAs and CFEs who are committed to delivering the highest level of service to clients. These clients include the world's largest corporations, financial institutions and law firms in matters involving financial and operational improvement and major litigation.

* Hutchinson & Bloodgood Promotes Douglas Kawamura as Partner-------------------------------------------------------------Hutchinson and Bloodgood LLP, a leading Certified Public Accountant and Consulting firm serving the metro Los Angles area for over eighty-two years, reported the promotion of Douglas W. Kawamura, CPA to Partner.

Mr. Kawamura joined Hutchinson and Bloodgood LLP in 2002 as the Director of Estate and Income Tax Planning. He has played a strategic role in shaping the firm's team of estate planning advisors and thriving business and tax practice. As a member of the Firm's Tax Committee, Mr. Kawamura also specializes in corporate, partnership, trust and individual income taxation. Mr. Kawamura also has extensive international tax and ESOP background. His diverse practice includes manufacturers, wholesale distribution companies, real estate investors, professional organizations, and high net worth individuals.

"It is often difficult to understand the laws governing estate taxes; the planning process can be very complex. Doug's leadership of the Firm's Estate and Income Planning Group is a tremendous resource for our clients," said Michael W. Machado CPA, Managing Partner for Hutchinson and Bloodgood LLP. "Estate planning is a lifelong process in which you start by evaluating your situation, develop a plan or vision for your family and take the necessary steps to make the plan a reality. I look forward to leading the firm's Estate Planning Group and to provide creative solutions for our clients. Our goal will be to provide our clients with a road map that allows the client to achieve their wishes while still minimizing the tax impact to the family," commented Mr. Kawamura.

Prior to joining Hutchinson and Bloodgood LLP, Mr. Kawamura was a Tax Partner in a Westside CPA firm and a Senior Tax Manager with the fifth largest CPA firm in the nation. A graduate of Golden Gate University, San Francisco, he has a Master of Science degree in Taxation. Mr. Kawamura 's Bachelor of Science degree in Accounting is from California State University of Sacramento.

In addition to membership in the American Institute of Certified Public Accountants - Tax Section and the California Society of CPAs, Mr. Kawamura is active with the San Gabriel Estate Planning Council. He has also been a Sub-Chairman of the Taxation Committee - Los Chapter of the California Society of CPAs and past officer of the Los Angeles Estate Planning Council.

About Hutchinson and Bloodgood LLP

Hutchinson and Bloodgood LLP has a reputation of providing quality service for over eighty-two years. Its success is due to a pro-active client service philosophy that provides continuous personal service to each client in the areas of management advisory, technology consulting services, business valuations, auditing, accounting and taxation. Hutchinson and Bloodgood LLP originated in Glendale, California and has grown to five offices with eighteen partners and a professional staff of over one hundred individuals. The Glendale office is located at 101 N. Brand Blvd., Ste. 1600, Glendale, CA 91203, (818) 637-5000. For more information about Hutchinson and Bloodgood LLP visit their website at http://www.hbllp.com/

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Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities.Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test.

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Monthly Operating Reports are summarized in every Saturday edition of the TCR.

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